‘Our best stock has made 1,750pc – and saved lives’

Baillie Gifford Positive Change manager Lee Qian invested early in the vaccine developer Moderna, he tells Rachel Mortimer

Ayear after it first featured in Fund of the Week, Baillie Gifford Posi tive Change remains comfortably ahead of its rivals. Since the fund’s launch in January 2017 it has returned nearly 300pc, the best performance of any global stock fund over that period by a considerable margin. Positive Change has even kept pace with the top global investment trust, Scottish Mortgage, also run by Baillie Gifford.

Such stellar returns, from an investment approach that seeks companies able to contribute positively to society, have attracted a legion of investors. In the 12 months since we last profiled the fund, it has surged from £770m to £2.8bn in size.

However, the past year has had its challenges. The fund took a knock in February when fears over a rise in inflation hurt shares in the fastgrowing companies its managers buy. It has since bounced back, however.

Lee Qian, one of Positive Change’s four managers, returns to the Telegraph Money hot seat to tell us how he is steering one of Britain’s fastestgrowing funds.

WHO IS THE FUND FOR? Hopefully the fund is for everyone, regardless of whether you are keen on sustainability and doing your bit for the planet and society.

ISN’T THERE A CONFLICT BETWEEN DOING GOOD AND MAKING MONEY? A lot of companies face a potential conflict between doing what is good for society and performing well financially.

Large carmakers, for example, have been dragging their feet on producing electric vehicles. That’s because it would represent a huge cost to their businesses, which are based on producing petrol and diesel cars.

We are not so interested in those types of business. Instead we look for a select group of companies that are disrupting the status quo and leveraging new technology to address environmental and social challenges.

WHAT HAVE YOU BEEN BUYING RECENTLY? One of our most recent investments is Coursera, which provides online education to around 70 million students.

Digitalisation on a global scale will be a very exciting area over the coming years. It can equip people with the skills to secure good jobs, but also support access to essential services, such as banking and healthcare, in emerging markets.

ARE THERE ANY AREAS YOU STEER CLEAR OF? We intentionally have a very inclusive approach, so there are no areas we would avoid. There are potential opportunities everywhere.

A lot of traditional ethical funds will screen out certain industries they feel don’t align with their values. But we believe it is much better to focus on the companies that drive change in society, regardless of their sector.

Even in industries that are traditionally very energy intensive or polluting there are companies which are reducing that negative impact and developing better ways of doing things.

DOES INFLATION POSE A THREAT TO YOUR INVESTMENTS? I don’t think inflation is a huge issue for the companies we invest in.

Take Tesla. What really matters with that business is whether it can scale up the manufacturing of electric vehicles, make them affordable and grow the market, while staying competitive and profitable. Whether inflation is going to be 1pc or 3pc will have fairly minimal impact on how we value that business.

WHAT HAS BEEN YOUR BEST INVESTMENT OF THE PAST YEAR? The clear winner from the past year is Moderna. We invested at $24 per share when the company floated in 2018 and now the shares are at about $420.

We saw potential for its technology

to develop vaccines quickly and effectively and the past year has been a fantastic illustration of that. Not only has the development of its Covid-19 vaccine helped save a huge number of lives, but Moderna has been the standout company in our portfolio.

WHAT HAVE YOU SOLD? We sold Alphabet, which owns Google, in May, over concerns about the impact of its monopoly position on society.

When we first invested we saw the company as playing an important role in providing access to the internet and data, which is a powerful equalising force in society. But it reached such a dominant size that it had the potential to reduce innovation, so no longer fitted with our aims.

WHAT WOULD YOU BE IF NOT A MONEY MANAGER? I love art and paintings, so would try to pursue a career there.