Responsible Funds, April 12: Luxembourg agency plans ESG label for investment funds

The round-up of responsible funds and indices news

Luxembourg fund labelling agency LuxFLAG is looking at developing an ESG label to apply to investment funds in its domicile, said the agency’s chairman Tom Seale. LuxFLAG is the independent body backed by the Grand Duchy’s finance authorities which currently labels microfinance and environmental funds. Seale, who is also chief executive of European Fund Administration, the bank-backed administration and middle office services provider, added that LuxFLAG was also looking at developing an impact investing label. He was speaking at an event organised by fund association ALFI. LuxFLAG currently labels seven environmental funds with a combined $692m of assets. It also labels 25 Microfinance Investment Vehicles (MIVs) with around $3.83bn of assets.

Sparinvest’s €96.91m Ethical Global Value EUR R fund has returned 10.65% in the quarter to the end of February – against a benchmark (MSCI World) return of 6.69%. The fund, launched in May 2008 and managed by Kasper Billy Jacobsen and Jens Moestrup Rasmussen, applies an ethical screening that identifies the companies that do not fulfill an ethical framework.

There’s been a slight change to the Jantzi Social Index. Toronto-listed Inmet Mining Corporation has been removed due to its acquisition by First Quantum Minerals. Consequently, First Quantum will replace Inmet on the JSI as it is in the top third of diversified metals companies according to Sustainalytics’ environmental, social and governance analysis.US socially responsible investment specialist Zevin Asset Management says its Global Appreciation and Global Appreciation with Income composites both outperformed their respective benchmarks in the first quarter of 2013. The former rose by 7.4% (MSCI All Country World Index benchmark: 6.6%). The latter was up 4.8% (MSCI ACWI / Barclays Government Bond Index benchmark: 3.9%). Zevin holds a conference call on April 16. Link

The €197.9m Dexia Sustainable Europe fund, a subfund of the Dexia Sustainable sicav, has returned 14.43% in the year to the end of March, compared to a benchmark (MSCI Europe) return of 10.90%. The fund invests in stocks of European companies which are, within their sector, best-in-class (top 35%) in terms of integrating environmental, social and governance concerns into their business models and their stakeholder management. Moreover, eligible portfolio holdings must act in accordance with the UN Global Compact’s ten principles and may not be involved in the arms industry. It returned 17.51% in 2012, against a 13.98% benchmark gain.

Schroders’ Global Climate Change Equity fund returned 11.8% in 2012, against a benchmark (MSCI World – Net Return) return of 15.8%, fund documents show. The $176.2m fund, launched in 2007, is managed by Simon Webber and Giles Money.

UBS says it now has CHF253.73bn (€208.6bn) – or 11.4% of its total assets under management – invested according to socially responsible principles. This was an increase of 5% over 2011, the Swiss bank notes in its 2012 Corporate Responsibility report.