Fund Solutions

This Week’s Fund News: UBS Launches SDG-Aligned Future of Earth Fund

ESG Investor’s weekly round-up of news about funds designed to meet sustainable investing criteria, including UBS, Vanguard, Columbia Threadneedle, Credit Suisse, Amundi and Stonehage.

UBS Global Wealth Management (GWM) has launched the Multi Managers Access II – Future of Earth fund. Aligned with the United Nation’s Sustainable Development Goals, the fund will invest in companies addressing environmental issues across four key themes: people, health and communities; sustainable energy; land; and water. It will be managed by multiple active equity portfolio managers: Allianz Global Investors, Pictet Asset Management, Polar Capital and Robeco. They will each be benchmarked against the relevant specific MSCI thematic index. This is the fourth thematic fund launched by UBS GWM, following Digital Transformation Dynamic, Digital Transformation Themes and Future of Humans funds. “In an environment of rising bond yields and increased volatility, we see an opportunity for investors looking to position for structural growth. This fund allows us and our clients to harness the power of investing towards preserving our planet for the next generation and gaining exposure to the sectors set to lead the way. Investors should consider this fund as part of a diversified long-term portfolio,” said Bruno Marxer, Head of Global Investment Management at UBS GWM.

Vanguard has expanded its ESG range with the launch of its ESG Global Corporate Bond UCITS ETF. Tracking the Bloomberg Barclays MSCI Global Corporate Float-Adjusted Liquid Bond Screened index, the ETF is designed to be a core building block for ESG-aware portfolios, incorporating robust screening based on the firm’s ESG criteria. The fund will be managed by Vanguard’s Fixed Income Group (FIG), which currently manages US$1.7 trillion in global assets. Through Vanguard’s ESG criteria, companies involving weapons, non-renewable energy or controversies related to the UN Global Compact Principles will be automatically excluded from the fund. “For those investors wishing to mitigate ESG risk or avoid companies that don’t align with their values, we are pleased to offer access to an ESG global corporate bond strategy through the new Vanguard ESG Global Corporate Bond UCITS ETF,” said Fong Yee Chan, Head of ESG Strategy for UK and Europe at Vanguard.

Columbia Threadneedle Investments has launched two new sustainable funds – the (Lux) Sustainable Outcomes Global Equity fund and the (Lux) Sustainable Outcomes Pan-European Equity fund. The funds implement concentrated equity strategies, one global and one pan-European, that will invest in high-quality companies which are targeting positive sustainable outcomes. The portfolio managers will use Columbia Threadneedle’s responsible investment analysts and ratings of over 8,000 companies globally to build the portfolio. “We know that investors want to support solutions to the world’s sustainability challenges. Demand for sustainable investment is growing as governments work toward achieving global climate and social goals, and we have seen this intensify as the consequences of the coronavirus pandemic are assessed,” said Michaela Collet Jackson, Head of Distribution, EMEA, at Columbia Threadneedle.

Credit Suisse has announced the final closing of the Climate Innovation Fund. The US$318 million fund is geared towards allocating capital towards venture capital companies developing disruptive technologies that help reduce greenhouse gas (GHG) emissions. The Climate Innovation fund will commit capital to ten venture funds that meet the criteria across North America, Asia and Europe and across sectors. Its investment process will involve reporting both the positive impacts a company generates through its business processes and products as well as the positive impact an investor generates through enhancing corporate performance by financing or active ownership. “By partnering with mission-driven venture firms, this fund will empower entrepreneurs to commercialise and grow their radically transformative technology and business ideas in order to contribute to planetary health at scale,” said Sven-Christian Kindt, Head of Private Equity Portfolio Solutions at Credit Suisse.

Amundi US has launched two global equity funds focused on sustainable investing and ESG integration. The Pioneer Global Sustainable Value fund will focus on long-term capital value, with 45-65 holdings in companies that have strong sustainable business models and adhere to the fund’s ESG criteria. Its benchmark is the MSCI ACWI Value index. The Pioneer Global Sustainable Growth fund seeks to invest in securities of issuers demonstrating potential for earnings and revenue growth, also with a focus on identifying companies with strong sustainable business models that meet the criteria. “Each fund offers a focused strategy aimed at capitalising on important global themes in both growth and value equities. As value stocks appear to be returning to favour with the global economic recovery, a portfolio focused on identifying companies that we believer operate sustainable business models and adhere to the fund’s ESG criteria, may be attractive to long-term investors,” said Marco Pirondini, Head of US Equities for Amundi US.

Stonehage Fleming Investment Management has announced the launch of its Global Sustainable Equity fund. Since launch, the fund has attracted over US$106 million in assets from investors looking for global sustainable equity strategies. This follows the successful launch of its Global Sustainable Investment portfolios in 2019. “We made the decision that this, our first standalone sustainable investment fund, should be focused solely on equity investments as we see them as the key drivers of return. Our equity investments can tackle a breadth of issues, including building back from Covid-19 and helping to address the majority of the United Nation’s Sustainable Development Goals. We can also measure and report the impact that our clients’ investments make towards creating a sustainable planet and society,” said Graham Wainer, CEO and Head of Investments.

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