Polen Capital’s mission is to preserve and grow client assets to protect their present and enable their future. Our Small Company Growth Team believes businesses that thoughtfully balance the interests of all stakeholders while delivering value are in the most favorable position to deliver sustainable outcomes and profitability.
The world has never been more transparent with the advent of a mobile-connected global population. Societal tolerance for mistreatment of employees, suppliers, the environment, and customers is decreasing in a world of abundant choice created through digital connectivity. Customers are no longer limited by physical shelf space, employees are no longer beholden to the largest employer in town, and disruption from a new start-up or business model always lurks around the corner.
Authentic brand, equitable culture, and transparent management contribute to a company’s competitive advantage.
Our Philosophy
We believe that the management and company-wide behaviors that enable and drive long-term value creation broadly overlap with ESG (Environmental, Social, and Governance) practices. Therefore, we do not think of ESG as a separate process but rather a set of characteristics integrated into our investment research through a Total Stakeholder Mindset. We believe this mindset drives behaviors that can, in turn, sustain long-term compounding.
Our approach is also rooted in materiality. We focus on the ESG behaviors that are material to the types of companies we invest in and material to our investment criteria – the Flywheel. Our process always comes back to the Flywheel and the factors that we believe enhance or detract from a company’s ability to drive long-term value creation. We believe that many ESG behaviors tend to drive good Flywheel outcomes.
Learn more about the Small Company Growth Flywheel Framework →
Our Research Process
At Polen Capital, we are laser-focused on understanding how a company fits into its ecosystem. We believe this means that good ESG outcomes are a natural consequence of our research process. We:
- Focus on identifying a company’s key stakeholders and evaluating how a company delivers value to them.
- Ask ourselves and management teams questions like why employees choose to work for the company instead of competitors and how the company attracts talent with aligned values.
- Look for management teams who view the company’s culture and mission not as afterthoughts but as necessary and instrumental components of competitive advantage.
- Evaluate why new company initiatives enhance risk mitigation and create sustainable value for its customers.
In sum, we believe authentic brands, equitable culture and values, and transparent management processes contribute to a company’s competitive advantage and enable long-term innovation and profitability.
Important Disclosures
The information provided is for informational purposes only. Opinions and views expressed constitute the judgment of Polen Capital as of January 2021, may involve a number of assumptions and estimates which are not guaranteed, and are subject to change without notice. Although the information and any opinions or views given have been obtained from or based on sources believed to be reliable, no warranty or representation is made as to their correctness, completeness or accuracy. Opinions, estimates, forecasts, and statements of financial market trends that are based on current market conditions constitute our judgment and are subject to change without notice, including any forward-looking estimates or statements which are based on certain expectations and assumptions. The views and strategies described may not be suitable for all clients. References to specific securities, asset classes and financial markets are for illustrative purposes only and are not intended to be, and should not be interpreted as, recommendations. This document does not identify all the risks (direct or indirect) or other considerations which might be material when entering any financial transaction.
ESG refers to Environmental, Social, and Governance criteria. The Small Company Growth Team integrates material environmental, social, and governance (ESG) factors into research analysis as part of a comprehensive evaluation of a company’s long-term financial sustainability. There is a risk that the investment techniques and risk analyses applied, including but not limited to the integration of ESG factors into the research analysis, will not produce the desired results and that legislative, regulatory, or tax developments may affect the investment techniques available. There is no guarantee that the investment objective will be achieved.