Responsible Funds April 10: Azzad AM, ICCR, Woodford Patient Capital, Future Super, Impax

The round-up of responsible funds news

Islamic funds group Azzad Asset Management has become the first Islamic finance firm to join the Interfaith Center on Corporate Responsibility (ICCR), the US-based body that represents 300 member organizations with over $100bn in assets under management. ICCR Executive Director Laura Berry said: “We are pleased to count Azzad Asset Management among the ranks of our members and look forward to partnering with them to advance the cause of conscientious capitalism for the benefit of all members of society.” Azzad is investment advisor to the Azzad Funds and sponsor of the Azzad Ethical Wrap Program.

Separately, the ICCR’s Berry has written to the Guardian newspaper on the topic of fossil fuel divestment. “Responsible investors are deploying all their tools – divestment, engagement and everything between – to advance green energy solutions because we believe multiple and collective, inside and outside strategies are needed for what is a herculean task,” she writes. “Is the cause best served by discrediting the methodologies of our allies or leveraging the complementarities? Should we focus on our tactical differences or concentrate our collective energies on our common climate change enemies: investor apathy and policy inertia? We propose the latter.”

Famed UK fund manager Neil Woodford’s new ‘patient capital’ fund is being expanded. The Woodford Patient Capital Trust was originally set to raise £500m, though its new maximum amount will be £800m. “Over the past few days it has become clear that the concept of investing patient capital in early-stage and early-growth businesses has captured investors’ imagination,” Woodford Investment Management said. Launched in May 2014, it already has more than £9.3bn in assets under management and advice. Link

The Norwegian government has reportedly proposed appointing a new central bank deputy governor to oversee the huge Government Pension Fund Global. The idea, Reuters reported, would be to create a second deputy governor position at the bank. The move, which would need parliamentary approval, would aim to counter criticism that the existing system doesn’t properly oversee the influential fund.

The World Bank has approved a climate investment mechanism to be implemented by indigenous peoples and local communities seeking to address deforestation and forest degradation. The Dedicated Grant Mechanism (DGM) for Indigenous Peoples and Local Communities is funded through the Climate Investment Funds (CIF) Forest Investment Program (FIP). Projects have already been approved in Brazil and globally for a learning support project with proposals under development in Burkina Faso, the Democratic Republic of the Congo and Peru. Link*Australian fossil free funds group Future Super* has commissioned a study, by Thomson Reuters, which has found that a fossil fuel-free portfolio would have achieved an annualised return of 25% from January 2012 to January 2015, reports the Sydney Morning Herald. That compares with 15% for the S&P ASX 300-heavy Thomson Reuters Australia benchmark, the reported added. Future Super, which launched last year, screens out companies that extract or process fossil fuels, as well as the banks that finance such projects, such as ANZ, Commonwealth Bank, NAB and Westpac.

Impax Asset Management, the AIM-listed environmental fund manager, says its assets under management have risen to a new high of £3.1bn (€4.3bn). That compares to just over £2.9bn at the end of 2014 and the rise was driven by inflows of £37m and market appreciation of £146m. A year ago AUM was £2.5bn.

NEI Investments, the Canadian mutual funds firm known for its Ethical Funds family, is changing the investment objectives of two of its funds. The NEI Select Canadian Growth Portfolio and NEI Select Canadian Balanced Portfolio will be changed so they can invest outside the country. They will be renamed NEI Select Growth Portfolio and NEI Select Balanced Portfolio, respectively, with the change taking place in June.

Germany’s Global Challenges Index (GCX), which comprises 50 companies deemed sustainable, and a basket of bonds from those companies (called Global Challenges Corporates – GCC) now have a record €340m in assets invested in them, as of March 31. It compares with the €290m in assets recorded at the end of 2014, said the Hanover bourse, which runs the GCX and GCC together with German ESG firm Oekom Research. Since its inception in 2007, the GCX alone has gained almost 100%. Beyond the institutional money invested in the index, the Hanover bourse said that recently, two funds for private investors had emerged, including one managed by German Landesbank NordLB.

Japan’s new JPX-Nikkei 400 ‘governance’ index, launched to encourage a focus on shareholder interests and since adopted by the giant Government Pension Investment Fund (GPIF), has run into what reports have termed a “quandary”. Reuters, citing research by Okasan Securities, said stocks expelled last summer because they no longer met the criteria had “far outperformed” the companies that replaced them.