Friday Funds: S&P DJI launches commodities index with environmental metrics

The latest developments in ESG-related funds: JPMorgan AM launches Article 9 fixed income strategy; Danske Bank adds £35m agri fund.

S&P Dow Jones Indices has launched a first-of-its-kind commodities index incorporating environmental metrics. The GSCI Climate Aware will offer investors ongoing exposure to the global commodities sector in line with its parent benchmark S&P GSCI. It will reallocate the weights of its constituents away from high-intensity fossil fuels and shift them to commodities crucial to the global energy transition. It will also maintain an allocation to food commodities. The index seeks to achieve a 25 percent reduction in environmental impact per dollar invested compared to the S&P GSCI, along with a 5 percent year-on-year decarbonisation target, while maintaining total food production and ensuring land and water environmental impacts are no higher than the S&P GSCI.

JPMorgan Asset Management has launched an Article 9 environmental and social fixed income strategy, available as both a SICAV and an ETF. The Green Social Sustainable Bond Fund and Bond UCITS ETF will be benchmarked against Bloomberg’s new Global Aggregate Green Social Sustainability Bond index, which offers investors exposure to green, social and sustainable bonds across developed and emerging markets. All bonds in the strategy will be linked to sustainable activities, in line with the International Capital Markets Association’s principles. The strategy will be managed by Stephanie Dontas, Ed Fitzpatrick and Usman Naeem.

Danske Bank has launched a £35 million ($42 million; €40 million) agriculture sustainability fund to support agri-business customers introducing sustainability initiatives and transitioning to net zero. The Agri Sustainability Fund will initially focus on the installation of “on-farm” renewables, such as solar panels, wind turbines, battery storage systems and anaerobic digesters. The fund will be managed by newly promoted agriculture sustainability manager Paul Clingan.

Solar company Nuru has received $1.5 million in commitments, bringing its Series B funding round total to $25 million. The company is aiming to build 13.7MWp of isolated solar-hybrid grids by mid-2024 to support the Democratic Republic of Congo’s energy deficit. Investors include Renewable Energy Performance Platform, Proparco and E3 Capital, which each invested $500,000 in the company. Nuru is currently developing three projects in Goma, Kindu and Bunia.