Friday Funds: More than 30 companies ejected from FTSE4Good index

The latest developments in ESG-related funds: GS raises $1.6bn for climate strategy final close; AXA launches plastic and waste equity fund.

FTSE Russell ejected 34 companies from its broad market FTSE4Good All-World Index in December for failing to meet climate requirements. The financial data provider had warned 208 portfolio companies from the 1,500+ constituent index fund that they were at risk of demotion in June 2021 due to low climate performance scores. The climate rating methodology used by FTSE Russell was developed by the UK’s Transition Pathway Initiative, an investor-focused corporate climate NGO founded by the Church of England Pensions Board’s Adam Matthews.

Goldman Sachs has raised $1.6 billion at the final close of its inaugural climate direct private markets strategy. The Horizon Environment and Climate Solutions I fund targets clean energy, sustainable transportation, waste and materials, sustainable food and agriculture, and ecosystem services. The Article 9 fund is the first of a series of “Horizon Funds” focusing on investments in key sustainability trends.

AXA Investment Managers has launched an equity fund dedicated to plastic and waste transition. The WF ACT Plastic and Waste Transition Equity QI Fund will support the UN’s Sustainable Development Goals, in particular SDG 12 for responsible consumption and production. It will invest in large-, mid- and small-cap companies across developed and emerging markets. The fund will be managed by the AXA IM Equity QI team.

Trium Capital has launched its first Article 9 impact hedge fund. The Climate Impact Fund is a UCITS equity long/short market neutral strategy that will aim to deliver long-term returns with low correlation to traditional asset classes, while driving positive environmental outcomes. The new strategy builds on Trium’s existing ESG-aligned offering. The fund will be co-managed by Joe Mares and Tom Ayres.

Euronext has launched the index CAC SBT 1.5C, a climate-focused version of the CAC 40 that will align with the Paris Agreement. The index will only invest in companies within the SBF 120 Index with emissions reduction targets in line with the 1.5C goal. It will incorporate negative screening on the basis of the UN Global Compact Principles, as well as for oil and gas, coal, controversial weapons and tobacco activities. The index was launched with the support of Amundi, CDP and SBTi.

Private equity firm TPG has launched an inaugural fund to invest in underrepresented alternative asset managers. The TPG Next Fund has received an anchor investment of $500 million from CalPERS. The strategy’s goal is to increase the number of diverse-led firms in alternative assets. TPG will continue to raise third-party capital. The fund will join The Rise Fund and TPG Rise Climate as part of TPG’s global impact investing platform.