Friday Funds: Robeco widens fossil ban as BNP raises €80m for sustainable private equity

Robeco has rolled out its fossil fuel exclusion across all of its funds, meaning companies that derive 25% or more of their revenue from thermal coal or oil sands, or 10% or more from Arctic drilling, will be barred from investment portfolios. The exclusion applies to all of Robeco’s mutual funds, excluding client-specific funds and mandates but including sub-advised funds.

Swedbank Robur has aligned five of its funds with the Paris Agreement. The funds, all part of the Access Edge range, cover the US, Japan, Sweden, emerging markets and global markets. They are aligned with the EU’s new climate benchmarking rules, and holdings must have a carbon footprint at least 50% lower than their peers. In line with the new EU regulation, emissions must be reduced by 7% annually.

BNP Paribas Capital Partners has announced first close of its Singularity Fund, raising €80m to invest in “sustainable growth trends” including demographic shifts and developments in technology. It is a private equity fund of funds, and uses the SDGs as a framework for positive impact. Anne-Sophie Kerfourn and Emmanuel Haumesse will manage the portfolio. 

The S&P500 ESG Index has axed thermal coal on the back of investor demand. A statement from Mona Naqvi, Head of ESG Product Strategy for North America at S&P Dow Jones Indices, said that the index was meant to exclude “the types of business activities deemed unacceptable by the broadest possible majority of sustainability-minded investors” and that a recent consultation confirmed that “thermal coal companies may now be counted among this lowest common denominator of ‘unsustainable’ investments”. The index, which was launched in January 2019, now has 299 constituents with 78 more on the exclusion list and 125 underperforming peers on ESG according to S&P’s in-house scores.  

Triodos Investment Management has launched the Triodos Sterling Bond Impact Fund, focusing on corporate social and green bonds. It is the first sterling denominated fund from Triodos and will include bonds from companies working to improve environmental stewardship, social responsibility, ethics and governance.

Ethos, the Swiss Foundation for Sustainable Development, and Clartan Associés, an independent French management company, have joined forces to launch a new sustainable investment fund investing in European companies with small and medium-sized capitalisations that take social and environmental aspects into account in their business models.

The Luxembourg Finance Labelling Agency, LuxFLAG, has labelled 100 new funds, bringing the total to 303 investment products – representing growth of 92% over 12 months. The funds have more than €128bn under management, combined, and sees LuxFLAG enter Denmark, Finland and Spain. The labels are used by asset managers to highlight the sustainability, ESG or impact credentials of their investment products. The labels are valid for a period of one year. The full list of LuxFLAG labelled funds is available here.  

Goldman Sachs Asset Management has launched the Goldman Sachs Global ESG Enhanced Income Bond Portfolio. Corporate issuers are screened for negative social and environmental factors and assessed using in-house ESG scores, with bonds from the lowest scoring issuers eliminated. 

Infrastructure and private equity house Foresight Group has entered a joint venture with solar developer Elgin Energy to develop six projects in the UK with a total generating capacity of 200MW. Foresight runs more than £6.5bn, with more than half in renewable energy infrastructure.

The City Climate Finance Gap Fund has been jointly launched by ministers and directors of the German and Luxembourg governments, the World Bank, the European Investment Bank and the Global Covenant of Mayors. With a target capitalization of at least €100m, the fund will support city and local governments facing barriers to financing for ‘climate-smart’ projects.