at the Automobile Club. , the consistency of performance of the range over the last four years was examined.

Can you describe your management approach?

Matt Weisser: For almost a century, we have matched our active investment approach and service to our clients with a single objective: to create long-term value in a responsible manner. This commitment began in 1924, when MFS launched the first open-end mutual fund in the United States. It has continued as we have grown into a full-service global investment management firm. And we have never wavered from that commitment. Our ability to create value responsibly is the result of collective experience, risk management and long-term discipline.

How do you think these characteristics have set you apart from your peers?

Our global investment platform allows us to uncover what we believe are the best opportunities in the market through collective experience, long-term discipline and thoughtful risk management. We believe that the collective experience of our teams leads to better investment decisions. Through dialogue with the companies in our portfolios, we understand the factors that can influence sustainable value creation and can use our voting power to influence important issues.

Our teams bring together diverse ideas in a collaborative manner. They actively share and debate unique perspectives, which allow us to form convictions about our investment ideas. Finally, integrated research within our global platform helps develop local market insights and uncompromising information sharing across sectors, geographies and asset classes. We seek to be ahead of the curve in analysis, assessing the long-term quality, sustainability, upside potential and value of companies.

Managers have been confronted with the irruption of ESG in finance. Has this trend changed the way you work and invest?

Sustainable investment is part of MFS's roots. Rather than seeing sustainable investing as a separate issue, we have always put it at the heart of our management and research. It is a critical issue because the behaviour of companies, the diversity of their workforce and the way they treat the environment directly affects their ability to thrive in the long term. As active investors, we believe it is our responsibility to understand all the ESG factors that can have a significant impact on the future value of a company. In this way, we are able to identify the investment opportunities that we believe are best and most sustainable for our clients.

We follow a responsible investment approach, which includes considering material ESG factors in our process, applying well-considered proxy voting policies and engaging in careful dialogue with issuers. We believe this approach enhances our ability to meet our clients' objectives and our fiduciary responsibility. We are not convinced that we could achieve the same results by indexing our management to sustainability objectives or by imposing exclusionary criteria. This is why we do not seek to attract assets by offering ESG "products".

Do you see ESG as a performance driver or as a drag?

We see ESG as a significant opportunity for active managers to engage with companies and achieve better results, both in terms of client objectives and risk-adjusted performance over time.

2022 saw the first war on European soil after many years of peace in Europe. Will this event also shake up asset management?

Investors are rightly concerned about the geopolitical risks and investment implications of the Russian invasion of Ukraine. As investors, our job is to sift through all the available information and discern which ones are important for long-term cash flows. In times like these, when information comes in fast, the first thing to do is to sit back, gather data and think, and then ask yourself how the current situation affects the long-term financial performance of a particular company.

Whether it is a change in monetary policy, regulatory change or conflict, the process is the same. Given the suffering that accompanies any war, it may seem inappropriate to write about the financial markets at this time. However, while we cannot draw general conclusions about the consequences of this conflict, we do know that it is dampening growth and creating inflation. In other words, this war has the potential to accelerate two factors that have been weighing on markets in recent months, namely falling growth and rising inflation. Hence the increased importance of quality and stock selection, with a focus on the future cash flow trajectory.

What will 2022 look like?

At the beginning of 2022, we thought that this year would probably be dominated by a phase of volatility, probably more so than in recent years.

For some time, we have been warning that robust business fundamentals after the 2020 confinements are based on unprecedented levels of stimulus, and are therefore unsustainable. In our view, the inevitable normalisation of economic growth against a backdrop of rising input costs, particularly labour and compliance costs, will eventually lead to more adverse conditions for margins than market valuations currently reflect.

The Russian invasion of Ukraine is also likely to put further pressure on corporate margins by helping to further entrench supply shortages, with consequences that we expect to particularly affect long-term growth-sensitive stocks. Conversely, defensive and energy-related sectors may be better positioned to weather the shock.

In the bond markets, a regime of risk aversion can be expected in the wake of the crisis. This is likely to result in widening spreads, particularly among high yield and emerging market assets, and a slight flattening of the US yield curve. Judging by the current pullback in safe assets, the upward normalisation of rates that was well underway in US Treasuries is likely to pause.

At the same time, as is often the case in periods of risk aversion, the US dollar should benefit from its defensive characteristics, with negative repercussions for higher-beta currencies, including those of emerging countries.

From a fundamental point of view, whether it is growth or inflation, we expect interest rates to move higher. Our ultimate goal is to be active and to allocate our investors' capital efficiently. And this is central to our approach to the macro environment through individually focused investments in companies, while trying to articulate these views on behalf of our clients. Finally, we remain true to our purpose: to invest our clients' capital in a responsible manner."