Hosking Partners is a London boutique founded in 2013 by Jeremy Hosking, a portfolio manager at Marathon Asset Management for over 25 years. It runs a single global equity strategy built on the capital-cycle, supply-side approach — contrarian, long-term, and unusually diversified (350+ holdings) under a multi-counsellor model, managing around $5.5bn.
This report focuses on two themes: China's solar industry faces state-backed overcapacity and forced labor allegations, weakening its investment case; Japan's corporate governance reforms, pushed by activist investors, are improving shareholder returns, and the author is optimistic. Key holdings include Chinese solar companies (overcapacity risk), Japanese firms (governance reform opportunities), and portfolio material exposure (highlighted by an intern's research).
At a Glance Hosking Partners' Q3 2023 ESG and Active Ownership report focuses on China's solar energy industry, noting that state-supported polysilicon overcapacity and forced labor allegations have weakened the investment thesis, but emphasizing that its supply chain analysis approach can uncover a
This report covers the relatively quiet summer period of the third quarter and the intensive research activities in September, including research trips and meetings in Hong Kong, Japan, and Sri Lanka. Continuing the China theme from the previous issue, the report provides an in-depth analysis of the solar industry while also discussing investment opportunities arising from corporate governance reforms in Japan. It also includes a research summary by intern Sophia Ground on the portfolio's material exposure.
The author notes that while solar energy is an exciting energy transition technology, state-sponsored polysilicon overcapacity and allegations of forced labor in China are undermining its investment appeal. The author's original statement, "state-sponsored polysilicon overcapacity and allegations of forced labour weigh on the investment case," emphasizes that these factors are putting pressure on the investment thesis. The report highlights that its supply chain-focused analytical approach can uncover alternative opportunities within the same theme.
Chris Beaven discusses the investment team's recent research trip and meetings in Japan, arguing that corporate governance reforms—driven by activist investors—are laying the groundwork for enhanced shareholder returns. The author's assessment is [optimistic], noting that the reform process is consistent with the views expressed in the previous issue and that actual progress is accelerating.