Emerging market stocks combining long-term growth and sustainability
Andrew Ness, portfolio manager of the Templeton Emerging Markets Sustainability Fund tells us where he’d put his money.

Sustainable investing is a long-term, multi-stakeholder approach to value creation. It has a clear focus on positive, real-world, social and environmental outcomes. These are delivered and quantified in an effective, accurate and repeatable way. Our strategy is one of the few available to give investors pure emerging market equity exposure with a focus on sustainability.
We invest in a diversified portfolio of companies in developing or emerging nations, focusing on firms with good or improving sustainability criteria as defined by our proprietary environmental and social governance (ESG) rating methodology.
One of the main investment opportunities we have identified is closing the funding gap. The Organisation for Economic Co-operation and Development (OECD) estimates that the gulf between the annual financing requirement for emerging markets to meet the United Nations’ sustainable-investment goals by 2030, and current investment trends, is $3.9 trillion.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Firms we invest in that represent attractive sustainable investment opportunities and contribute to closing the funding gap include the following:
Emerging market stocks to watch
TSMC (NYSE: TSM) is the world’s largest semiconductor foundry. Through sustainable innovation in product development, the company benefits from higher efficiency and lower water and power consumption, preserving scarce resources.
The company supplies semiconductor chips for use in smartphones, artificial intelligence (AI) servers and cars. Major customers include Apple, Nvidia and Qualcomm. TSMC has foundries in Taiwan, China and the US, with plans to open additional ones in Europe and the US. Our strategy is to overweight the stock, reflecting our optimism over the long-term growth in global demand for semiconductors used in AI, consumer products and vehicles.
Hon Hai (NYSE: HNHPF) is the world’s largest contract electronics manufacturing company. Hon Hai aims to reduce the power consumed by its products, reduce emissions and bolster overall efficiency. The company’s business model focuses on original equipment manufacturing for consumer electronics as well as cloud and networking products and components. Customers include Apple, Microsoft and Cisco. Hon Hai has production facilities in China, India and Brazil.
The group employs more than one million people and plans to establish itself as a contract manufacturer in the electric vehicle industry. Our fund has a significant overweight position in the company, reflecting our view that Hon Hai is well-positioned to benefit from the trend of global supply chain diversification.
How to invest in India
ICICI Bank (NYSE: IBN) is one of the largest private-sector banks in India, with a network of over 6,000 branches. The bank provides individuals with access to capital for fulfilling basic needs, and helps fund small businesses, which drives employment creation in addition to social and economic development. It has a number of subsidiaries, including ICICI Prudential Life insurance, a separately listed company in which it holds a 51% stake. India’s economic growth, which has been the highest among emerging markets, is driving increased demand for financial services. We have a significant overweight position in the stock, reflecting our belief that ICICI will benefit from the increased penetration of financial services, ranging from bank accounts to life insurance.
This article was first published in MoneyWeek's magazine. Enjoy exclusive early access to news, opinion and analysis from our team of financial experts with a MoneyWeek subscription.
Get the latest financial news, insights and expert analysis from our award-winning MoneyWeek team, to help you understand what really matters when it comes to your finances.
-
House prices rising fastest in areas with highest crime rates – where does your area rank?
Property prices are higher in safer areas but growing more slowly than in places benefiting from gentrification and buy-to-lets
-
State pension age review launched – could it rise faster in future?
The government has announced a review of the state pension age, after it warned of a “retirement crisis” and revived the Pensions Commission to boost pension savings
-
Just Group has the wind behind it – should you invest?
Just Group, a retirement products provider, is well placed to profit from a growing annuity market
-
Personal Assets Trust: a fund to protect your wealth
Personal Assets Trust aims to shelter its shareholders’ assets from volatile markets
-
Britain’s fallen stars: a second chance for quality stocks
Quality stocks in the UK saw share prices collapse in the wake of Covid. That has created an opportunity for smart public investors — and private buyers
-
Electronic Arts: a winning game group
Electronic Arts is a fast-growing video-game maker which looks set for further success
-
Microsoft’s partnership with OpenAI is on the rocks
Microsoft’s joint venture with OpenAI, the developer of ChatGPT, appears to be in trouble. What now for the two groups?
-
Carson Block on short-selling and what investors should watch out for when going long
Interview Renowned short seller Carson Block talks to Matthew Partridge about his specialism and where to go long
-
Drinks maker Diageo gets back on its feet – should you invest?
Diageo has faced one disaster after another over the past two years. Is it finally time to buy?
-
Airtel Africa is dialling the right numbers – should you buy?
Opinion Mobile phone services group Airtel Africa is inexpensive and growing fast