5 Top Hedge Funds Focusing on ESG and Impact Investing

2. ValueAct Capital

ValueAct Capital is a hedge fund based in California. It is ranked second on our list of 10 top hedge funds focusing on ESG and impact investing. The fund has a portfolio value of over $8.5 billion. The finance and technology sectors comprise the majority of investments of the hedge fund. The fund was managed by Jeffrey Ubben till last year when he left to start his own venture. ValueAct has a strong ESG-focused approach to investments, a legacy left behind by Ubben who managed the fund for close to twenty years. 

A top holding of ValueAct Capital is Citigroup Inc. (NYSE: C), the investment banking firm based in New York. At the end of the first quarter of 2021, 90 hedge funds in the database of Insider Monkey held stakes worth $6.9 billion in Citigroup Inc. (NYSE: C), down from 95 the preceding quarter worth $7.1 billion.

In its Q1 2021 investor letter, Artisan Partners Limited Partnership, an asset management firm, highlighted a few stocks and Citigroup Inc. (NYSE: C)  was one of them. Here is what the fund said:

“We fully exited position in Citigroup. Global financial services company Citigroup made a $900 million clerical error and received a public reprimand from federal regulators. This, after a decade focused on process control, information technology and risk systems, makes the error substantially more costly than just the $900 million mistake. Regulators believe the company’s risk management improvements have fallen short of expectations. To rectify the situation, a process and technology spending surge could negatively affect 2021-2022 profits by 10% to 20%. Trust and confidence are important in large financial institutions, and this incident combined with the CEO’s sudden retirement shook ours.”