ESG Investor’s weekly round-up of news about funds designed to meet sustainable investing criteria, including LGIM, Amundi, LOIM, Algebris, R&M, and Banor Capital.
Legal and General Investment Management (LGIM), which has £1.42 trillion in AUM, has launched the L&G Net Zero Global Corporate Bond Fund. Targeting British and European institutional investors and wealth managers, the fund aims to deliver long term returns, net zero carbon emissions and improved ESG outcomes. Co-managed by Matthew Rees and Enda Mulry, it will utilise the energy transition scenario insights outlined by LGIM’s climate risk framework destination@risk, as well as measuring the portfolio’s climate risk and climate alignment. Rees, LGIM’s Head of Global Bond Strategies, said: “Investors are looking to access a well-diversified global credit universe that will provide them with an array of opportunities [and] they want to invest in portfolios that enable them to achieve net zero emissions in line with the Paris Alignment trajectory, as well as reach better ESG outcomes. This fund has been specifically designed to help investors achieve alpha generation, as well as positive climate and wider ESG objectives.”
French asset manager Amundi has announced the launch of the Amundi Funds Euro Corporate Short Term Green Bond (AFECSTGB). The new actively-managed fund will invest in green bonds issued by corporates with proceeds committed to funding environmentally friendly and climate-focused projects. It will target opportunities to upscale global clean projects, incorporating both a top-down and bottom-up investment approach. Amundi says all green bonds selected for the portfolio are in line with Green Bond Principles, and the fund will annually disclose the avoided tonnes of CO2 emissions through the implementation of financed green projects. It will be co-managed by Yael Muscat, Senior Credit Portfolio Manager, Alban de Faÿ, Head of Responsible Investment for Fixed Income, and Hervé Boiral, Head of Euro Credit. Amaury d’Orsay, Amundi’s Head of Fixed Income, said: “Corporate issuers have been increasingly committed to the fight against climate change. This has translated into a growing and increasingly diversified green corporate bond market. AFECSTGB seeks to enable investors protect their portfolio against rising interest rates while also seeking to generate a positive impact.”
Lombard Odier Investment Managers (LOIM) has announced the launch of a new food system strategy, designed to capture opportunities associated with the sustainable transformation of food systems, with prospective investments demonstrating efforts to restore planetary boundaries. It is the latest addition to Lombard Odier’s suite of CLIC thematic strategies, which includes Climate Transition, Natural Capital and the TargetNetZero range. The strategy will focus on the agriculture, forestry and other land uses system, regarded as a key driver of planetary boundary transgressions, accounting for 24% of greenhouse gas emissions, 90% of forest degradation, and 25% of biodiversity loss. Jean-Pascal Porcherot, LOIM’s Co-Head, said: “Returning 20% of land to nature and improving the quality of the earth’s remaining agricultural land will be a critical part of realigning our economy with the earth systems that support it. This will leapfrog the sustainability-driven transformation of our food systems and unlock a market worth at least $1.5 trillion in annual revenues by 2030.”
London-based Algebris Investments has launched of its first private equity fund following the close of its first fundraising round at €200 million. Algebris aims to raise €400 million for the Algebris Green Transition Fund over the next 12 months, which is labelled as Article 9 under the EU’s Sustainable Finance Disclosure Regulation (SFDR). The fund, managed by an industrial team headed by Algebris’ Managing Director Luca Valerio Camerano, will spearhead sustainable investment in the energy transition, circular economy, smart cities and AgriTech. It will be targeting companies exhibiting proven earnings potential, resilient business models and sustainable long term strategies, assisting in their expansion, consolidation and internationalisation. Valerio Camerano said: “Investors’ interest in this space and in this initiative continues to grow, and we are confident of reaching our ambitious fundraising targets at subsequent closings.”
River and Mercantile (R&M), a London-based specialist investment management company, has established its new SFDR Article 8-labelled R&M Global Sustainable Opportunities Fund (R&M GSOF). It will be managed by William Lough and is one of the strategies within its new range of sustainable equity funds. The fund is backed by UK multi-asset investment provider Quilter Investors and has been implemented for one institutional client so far. It utilises an active stewardship approach, combining valuation discipline with sustainability integration. The fund aims to capitalise on under-appreciated opportunities created by a generational shift in areas of the market R&M believes are likely to see a much-improved cycle than they have over the last decade. Lough said: “This fund will make a real-world difference, offers attractive diversification benefits for clients, and taps into return drivers which have a long shelf-life. Combined with the opportunity to drive change through engagement, this is truly active value investing for the 21st century.”
UK-based asset manager Banor Capital has renamed its Banor SICAV North America Long Short Equity Fund (BSNALSEF) as the Banor SICAV Volta Long Short Equity Fund (BSVLSEF). The firm said the renaming is to “reflect the fund’s increasing focus” on companies contributing to the energy transition, particularly to the battery value chain. Westbeck Capital will continue in its role as fund adviser. Labelled as Article 8 under SFDR, the fund uses an internal ESG rating and promotes environmental and social characteristics to identify companies and issuers with the strong ESG-related performance. Andrew Sandler, Banor Capital’s Head of UK Development, said: “After the excellent returns of 2019-21, the fund has preserved capital during 2022 and means we are well set to take advantage of the market dislocations that are currently presenting themselves.”