Legal & General, Osmosis launch passive environmental fund

Launch follows innovative carbon tracker fund for BT Pension Scheme

UK funds giant Legal & General Investments and environmental specialist Osmosis Investment Management have teamed up to launch a passive fund investing in global environmental-focused equities.
The retail investor-targeted Global Environmental Enterprise fund will be launched on June 16 with Legal & General putting in £30m (€33.6m) of seed capital. Legal & General Investments is the retail arm of the company which delegates fund management to Legal & General Investment Management (LGIM).
The new fund will be benchmarked against the 100 stocks in the Osmosis Climate Solutions index and be run by Robert Dowling who also oversees L&G’s Global 100 Index trust and Global Emerging Markets Index fund.

Low carbon revenues is the single factor for inclusion in the Osmosis index, with only companies above $100m in market capitalisation eligible for inclusion.

The launch follows a decision last month by the £35bn (€40bn) British Telecom Pension Scheme to put £100m into a new carbon efficient tracker fund developed for it by LGIM with the aid of FTSE Group and Trucost.The new fund aims to provide capital growth primarily through investment in companies that are profiting from the global response to energy scarcity, pressures on natural resources and the shift to a lower carbon world economy, L&G said.
“We are launching the Global Environmental Enterprises Fund to allow investors to invest at the right price in one of the major investment themes of this decade,” said Simon Ellis, Managing Director of Legal & General Investments.
Osmosis CEO June Aitken added: “The fact that Legal & General Investments is committed to a fund that identifies efficient solutions to environmental issues is evidence that this space is no longer niche, but a significant investment opportunity.”
The fund is structured as a global equity growth fund, and will sit in the global growth sector. The fund has a 33% weighting to the US, with 27% allocated to Asia-Pacific countries and 30% in Europe, a regional exposure that reflects developments in the three investment themes.