GLOBAL SUSTAIN

Strong on Engagement,
Light on Carbon,
Built on Quality

Being Principled,
Without Sacrificing Return
William Lock explains how portfolios can deliver on performance and principles.
 
1

Strong on engagement1

We engage directly–and often–with the management of companies we own. This gives us significant influence in key issues, including ESG-oriented ones.

 
 
 
2

Light on carbon2

Global Sustain is a reduced carbon intensity portfolio, with less than 10% of the carbon footprint of an average company in the MSCI World Index.

 
 
 
3

Built on quality3

The team seeks sustainably high return businesses that can compound over long periods. This has historically resulted in a portfolio that had higher returns on operating capital and greater margin stability than its ESG peers.

 

1 All interactions between International Equity Team portfolio managers and company management or non-executive board members from January 1, 2019 – December 31, 2019 where material E, S, or G factors discussed. Data updated annually.

2 MSCI ESG Research defines a portfolio's carbon footprint as the carbon emissions (Scope 1 and 2) of a portfolio per million dollars invested. They sum up all the emissions in a portfolio based on the investor's ownership share, using reported or estimated emissions data.

3 ROOCE (Return on Operating Capital Employed) = EBITA (Earnings Before Interest, Taxes and Amortization)/PPE (Property, Plant, Equipment) + Trade Working Capital (excludes goodwill). Ex-Financials.

1 All interactions between International Equity Team portfolio managers and company management or non-executive board members from January 1, 2018 – December 31, 2018 where material E, S, or G factors discussed. Data updated annually.

2 MSCI ESG Research defines a portfolio's carbon footprint as the carbon emissions (Scope 1 and 2) of a portfolio per million dollars invested. They sum up all the emissions in a portfolio based on the investor's ownership share, using reported or estimated emissions data.

3 ROOCE (Return on Operating Capital Employed) = EBITA (Earnings Before Interest, Taxes and Amortization)/PPE (Property, Plant, Equipment) + Trade Working Capital (excludes goodwill). Ex-Financials. EBIT Margin Stability is (1-(std deviation)/mean))10 year average. Free cash flow yield is a financial ratio that measures a company’s operating free cash flow minus its capital expenditures per share and dividing by its price per share. Free cash flow yield ratio is calculated by using the underlying securities of the fund. Data as of March 31, 2020, updated quarterly.


Fully Integrated ESG Process

 

Free of Tobacco, Alcohol, Gambling, Adult Entertainment, and Controversial Weapons or Firearms

 

Free of Fossil Fuels,
Bulk Commodities and
Gas or Electric Utilities

 

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TEAM PROFILE
Meet the International Equity Team
Led by William Lock
The International Equity team follows a disciplined investment process based on fundamental analysis and bottom-up stock selection.
View Team Profile 
Insights
International Equity Team Insights
Keep abreast of the fast changing world and look ahead for investment opportunities with the team's insight papers and videos.
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Insights
Global Sustain Magazine PDF
A compendium of 12 articles that shed light on a full range of ESG issues, including plastic waste, corporate incentives, governance and more.
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RISK CONSIDERATIONS
There is no assurance that a portfolio will achieve its investment objective. Portfolios are subject to market risk, which is the possibility that the market value of securities owned by the portfolio will decline. Market values can change daily due to economic and other events (e.g. natural disasters, health crises, terrorism, conflicts and social unrest) that affect markets, countries, companies or governments. It is difficult to predict the timing, duration, and potential adverse effects (e.g. portfolio liquidity) of events. Accordingly, you can lose money investing in this strategy. Please be aware that this strategy may be subject to certain additional risks. Changes in the worldwide economy, consumer spending, competition, demographics and consumer preferences, government regulation and economic conditions may adversely affect global franchise companies and may negatively impact the strategy to a greater extent than if the strategy's assets were invested in a wider variety of companies. In general, equity securities' values also fluctuate in response to activities specific to a company. Investments in foreign markets entail special risks such as currency, political, economic, and market risks. The risks of investing in emerging market countries are greater than risks associated with investments in foreign developed markets. Non-diversified portfolios often invest in a more limited number of issuers. As such, changes in the financial condition or market value of a single issuer may cause greater volatility. Illiquid securities may be more difficult to sell and value than publicly traded securities (liquidity risk).

INDEX INFORMATION
The MSCI World Net Index is a free float adjusted market capitalization weighted index that is designed to measure the global equity market performance of developed markets. The term “free float” represents the portion of shares outstanding that are deemed to be available for purchase in the public equity markets by investors. The performance of the Index is listed in U.S. dollars and assumes reinvestment of net dividends. The index is unmanaged and does not include any expenses, fees or sales charges. It is not possible to invest directly in an index.

Please consider the investment objectives, risks, charges and expenses of the funds carefully before investing. The prospectuses contain this and other information about the funds. To obtain a prospectus please download one at morganstanley.com/im or call 1-800-548-7786. Please read the prospectus carefully before investing.

Morgan Stanley Institutional Fund Inc. (MSIF) is an institutional mutual fund offering various active portfolios, including equity, fixed-income, international, emerging markets, real estate and growth.

Fund adviser MSIF is managed by Morgan Stanley Investment Management, Inc.

Morgan Stanley Investment Management (MSIM) is the asset management division of Morgan Stanley.

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