More than 300 funds representing €121bn have now been awarded the French finance ministry’s SRI label since its launch in November 2016. According to the French Asset Management Association (Association Française de la Gestion financière – AFG), products seeking to obtain the label must meet “a rigorous and exacting standard to demonstrate that they are managed using robust methods, are firmly committed to transparency and provide high-quality information”.
MAPFRE AM, the fund management arm of the European and Latin American insurance company, and French boutique La Financière Responsable (LFR) have launched the first fund for the inclusion of people with disabilities to be available throughout Europe. It is a Luxembourg-based sister fund to the MAPFRE Inclusión Responsible, which invests in companies that promote the inclusion of people with disabilities, which the partners have marketed in France exclusively until now. According to the firms, a historical simulation of the last five years shows that the portfolio of companies selected for their record on inclusion was nearly four times more profitable than the market as a whole.
German reinsurer Munich Re and Dutch development bank FMO have signed a $500m Risk Sharing Framework Agreement to scale up impact investing. The firms said the new Unfunded Risk Participation Program will allow Munich Re to invest up to $500m in the SDGs over the next three years by participating in transactions underwritten by FMO. FMO said: “By creating an efficient way of credit risk underwriting via portfolio solutions, the agreement also serves as a blueprint for further public-private partnerships.”
Northern Trust has been selected by Nordic giant Storebrand Asset Management as asset servicing provider to two of its “sustainable solutions” – its Luxembourg-domiciled alternative investment and UCITS funds. The UCITS umbrella fund will operate a number of sub-funds, which will focus on Storebrand’s ESG and selected value-based investment strategies from SKAGEN, the boutique acquired by Storebrand in 2017.
Flows to ESG-dedicated exchange traded funds are set to top $40bn in 2019 – up 20% from $33bn in 2018 and just $12bn in 2017, according to a new report from the Institute of International Finance. While the majority of the flows are to equity ESG funds, the ESG debt universe has also seen robust inflows. New issuances of sustainable debt and loans has also surged more than 40% to around $380bn this year, the report said.
Swiss house Mirabaud Asset Management has merged two of its ESG-focused Global Convertibles funds, with the French-domiciled Altitude Convertible Monde becoming part of the Luxembourg-domiciled Mirabaud-Convertible Bonds Global. Nicolas Crémieux, formerly Lead Portfolio Manager of both funds, will continue to manage the fund under the leadership of Renaud Martin, Head of the Convertibles Bond team.
The US Securities and Exchange Commission (SEC) is tightening scrutiny on ESG funds, the Wall Street Journal reported this week, revealing the regulator has sent several letters of enquiry to investment managers since last year. According to the article, the letters asked managers to list the stocks it had recommended to clients, its models for judging which companies are environmentally or socially responsible, and its best and worst performing ESG investments. The SEC examination work – which is separate from its enforcement division – is operating out of its Los Angeles office, the article said. Examiners cannot issue fines, but they can refer findings to SEC enforcement attorneys for official investigation.
RobecoSAM has liquidated one of its thematic sustainable equity funds run by head of investments Rainer Baumann, according to reports. As of October, the RobecoSAM Global Small Cap Equities fund – which invested in companies addressing challenges posed by megatrends like resource scarcity, pollution and climate change – had €10.92m in assets under management and had returned 31 .1% over the previous three years. The firm was quoted as saying that “despite a compelling investment proposition and investment case, the fund was unable to maintain critical size”. The other fund managed by Baumann, the RobecoSAM Global SDG Equities fund, will remain open.
Candriam, the European asset manager, has teamed up with fellow New York Life subsidiary, ETF firm IndexIQ, to launch two ETFs. The IQ Candriam ESG US Equity ETF and the IQ Candriam ESG International Equity ETF track two IndexIQ indexes that offer broad market exposure to large- and medium-cap companies that satisfy ESG criteria developed by CANDRIAM.
APG Asset Management has signed an agreement to acquire its first onshore wind energy project in the Netherlands, a new 32MWp facility near Rotterdam. The acquisition, via its majority-owned independent renewable energy developer Kallista Energy, is on behalf of its pension fund client ABP.