Responsible Funds, December 14: City of London signs up to PRI

The latest responsible funds news

The City of London Corporation, the municipal governing body of the City of London finance district, has become a signatory to the Principles for Responsible Investment. According to the PRI website, the corporation signed up as an asset owner on December 12. The corporation’s constitution is “rooted in the ancient rights and privileges enjoyed by citizens before the Norman Conquest in 1066”.

Swedish state fund Sjunde AP-fonden (AP7) says (Swedish) it has excluded US coal firm Peabody Energy from its investment universe for violating the terms of the Paris Agreement.

Ecofi Agir pour le Climat is a new multi-asset SRI fund from French sustainable boutique Ecofi Investments which targets firms working for the environmental and energy transition. Link (French)

Ossiam, a subsidiary of Natixis Investment Managers, has launched a smart-beta ESG exchange traded fund using “machine learning”. The Ossiam World ESG Machine Learning UCITS ETF uses an algorithm to select equities that meet ESG criteria.

Taiwan: Yuanta Securities Investment Trust Co. reportedly aims to launch the country’s first ESG exchange-traded fund next year. It follows Yuanta securing a licence for the FTSE4Good TIP Taiwan ESG Index, Asia Asset Management quoted portfolio manager Jessie Zhang as saying.

What’s claimed to be the world’s first benchmark index to price financial water risk to equities has launched on Bloomberg (Ticker Symbol: LYU5WRUG). LIMEYARD TSC Water Risk Index is designed to inform asset owners and investment managers of the water risk to equities in their financial portfolios through a portfolio theory-based risk model.

The Financial Conduct Authority (FCA), the UK regulator, has proposed changes to further enable retail investors to invest in “patient capital” through unit-linked funds. A consultation runs until February 28.

An open letter authored by 200 Cambridge academics alongside Noam Chomsky and the former Archbishop of Canterbury, Rowan Williams, has reportedly called for increased transparency in the way Cambridge University invests its endowment. This comes after members of the university’s executive council were denied access to investment documents which caused five members of the council to sign a note of dissent, saying “we cannot properly discharge our duty as trustees of the University if we are arbitrarily and persistently denied access to such documents”. Link*Man Group, the listed alternatives* firm, has outlined the Man Group RI Fund Framework, a formalised structure that quantifies the degree of RI focus for all Man Group funds. It has also launched the Man Group RI Exclusions List, a proprietary list of sectors and companies ineligible for portfolios. The framework is designed to establish a “baseline requirement” of ESG standards, and to provide “credibility, clarity and consistency” in Man Group’s approach to RI across its range of funds. There will be three categories into which all funds will fall: the base standard; a standard for funds with a further level of RI integration; and a standard for RI-dedicated funds.

Vigeo Eiris, the ESG intelligence provider, has joined the Pensions and Lifetime Savings Association (PLSA), the UK trade body.

LuxFLAG (the Luxembourg Finance Labelling Agency) has granted its first label to a German domiciled fund: an ESG label for UniNachhaltig Aktien Global. It has also granted its ESG Label to Midas Eurozone Equity, Midas Patrimonial Fund and CapitalatWork Foyer Umbrella – Sustainable Equities at Work. The Microfinance Applicant Fund Status has been granted to the Fund for Inclusive Finance in Rural Areas (FIR). LuxFLAG labels in total 38 ESG funds, 31 Microfinance, seven Environment and five Climate Finance funds.

The International Finance Facility for Immunisation (IFFIm) and the Islamic Development Bank Group (IsDB), a development partner of Gavi, the Vaccine Alliance, have announced plans for the IsDB to purchase a Sukuk issued by IFFIm, aimed at accelerating funding for immunisation efforts that save children’s lives in the world’s poorest countries. It is scheduled for early 2019 and the transaction is being arranged by First Abu Dhabi Bank (FAB).

Greencoat UK Wind PLC, the listed renewable infrastructure fund, has bought the Church Hill and Crighshane wind farms in Northern Ireland for a total £87m. It bought them from the Irish Infrastructure Fund, a fund jointly managed by AMP Capital and Irish Life Investment Managers, and from the Viridian Group, who held a minority stake.

The IFC has updated its corporate governance methodology to incorporate ESG. “To expand the application of sustainability and governance standards across entire financial systems of emerging markets, IFC has updated and expanded its methodology, to encompass environmental, social, and governance (ESG) issues into corporate governance practices,” it said.