10 ESG Investments for 2021 - Part 1

Eco-friendly Pesticides

Andrew Willis 29 April, 2021 | 4:55PM
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Andrew Willis: It’s time again for Morningstar Sustainalytics’ “10 for 2021” – which presents investors with 10 ESG investment themes that can positively contribute to advancing United Nations Sustainable Development Goals. In this series, we’ll feature a new development each week so that you can ‘create impact through thematic investing’.

This week, we’re talking about biological pesticides – which sound a lot scarier than they are. These are pesticides based on micro-organisms and beneficial bacteria, or just natural products like plants and minerals. They can improve ESG-related issues related to the environment and pollution, along with the social impact of products – especially when it comes to mitigating food shortages. 

We see firms offering biological pesticides benefitting from strong growth in the market and poised to reach 7.1 billion U.S. dollars by 2025, up from 2.8 billion U.S. dollars in 2018. One of the companies at the forefront of this organic sector is master of synthesis, Bayer. We see the drugmaker leveraging its research expertise to have one of the biggest impacts in the agrochemical space when it comes to the environment.

We also see Bayer as undervalued, and as the need for sustainable food production will very likely grow, this could be a good avenue for both long-term opportunity - and positive impact.    

For Morningstar, I’m Andrew Willis.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar Rating
Bayer AG31.15 USD0.08
Bayer AG ADR7.83 USD0.77Rating

About Author

Andrew Willis

Andrew Willis  is Senior Editor at Morningstar Canada. He previously produced content for Fidelity Investments and finance industry events for Euromoney Institutional Investor and has written in the past for Thomson Reuters and CNN. Follow him on Twitter @Andrew_M_Willis.

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