Friday Funds: Just Climate closes climate fund backed by Microsoft at $1.5bn

Just Climate, an investment business set up by Generation Investment Management to address net-zero challenges, has closed its inaugural climate fund on $1.5 billion. The Climate Assets Fund exceeded its $1 billion target, receiving investments from investors including the California State Teachers’ Retirement System (CalSTRS), PSP Investments, AP4 and AP2. The fund’s founding investor group included Microsoft’s Climate Innovation Fund, IMAS Foundation, Ireland Strategic Investment Fund, Harvard Management Company, the Imprint Group of Goldman Sachs and Hall Capital Partners. Just Climate has made three investments from the fund in Swiss electric vehicle charging company ABB E-mobility, and Swedish industrial and renewable energy companies H2 Green Steel and Meva Energy.

Morningstar has identified 27 “anti-ESG” funds, launched against the backdrop of the movement criticising ESG investing in the US. Assets in anti-ESG reached $2.1 billion at the end of March, seven times the total of one year ago, according to the research. Morningstar has grouped the funds into five categories: anti-ESG, political, renouncer, vice and voter. As expected, these funds have above-average exposure to controversial industries, such as controversial weapons and fossil fuels, and vote against pro-ESG shareholder resolutions.

Staying with Morningstar, the index provider has launched its Global Hydrogen Index designed to target companies that significant revenue from hydrogen adoption and exhibit increasing profit exposure to this theme. The holdings cover all portions of the hydrogen value chain, including utilities, transportation, and storage.

impak Analytics has launched five ESG-impact indices and ETFs at the London Stock Exchange, alongside its partners impact investor CIRCA5000 (C5K) and BITA, an index provider. They will enable investors to support positive change in five key areas, including green energy and technology, sustainable food and biodiversity, clean water and waste, social and economic empowerment, and health and wellbeing. Clients will be able to customise their index strategies through thematic screening, best-in-class, and exclusion for new product creation, direct indexing or benchmarking.

CIRCA5000 (C5K) has also adopted shareholder voting fintech Tumelo’s voting technology for this new range of impact focused ETFs, becoming the first UK ETFs to offer this service. Each institutional investor in the C5K fund range will be able to choose how they want to vote at corporate annual meetings via the platform, by selecting voting policy, voting ad hoc, or delegating to their fund manager. C5K is also considering offering the same service to retail investors.

Allspring Global Investments has launched its second climate transition fixed income fund. The Climate Transition Global High Yield Fund will target global high yield fixed income opportunities focused on best-in-class companies transitioning to a lower-carbon economy. The Article 8 fund joins related strategy, the Climate Transition Global Investment Grade Credit Fund, which was introduced in January 2021.

Calvert Impact has launched its Cut Carbon Note, a green bond for investors looking to tackle climate change. The bond finances sustainability upgrades for commercial buildings, with the objective of reducing carbon emissions. S&P Global Ratings provided a second party opinion from on green bond alignment, and BlueMark on the impact principles.

Lombard Odier Investment Managers (LOIM) has launched a sustainable investing platform alongside system change company Systemiq. The platform, Holistiq, will specialise in investing related to the transition to a greener economy, aiming to “deploy capital for a net-zero and nature-positive economy”. Holistiq will offer a suite of investment strategies across both public and private markets, with a dedicated pillar on nature-based solutions.