Responsible Funds, Feb. 2: Kempen, Aberdeen Standard, ALFI, ETHOS, John Laing, Santander

The latest responsible funds news.

Kempen Capital Management, the asset management subsidiary of the Dutch merchant bank Kempen & Co, has launched a “multi-asset impact fund” that aims to benefit society and the climate whilst delivering “market-level financial returns”. The SDG aligned Global Impact Pool – which will be managed by Marjoleine van der Peet, Senior Portfolio Manager, and Narina Mnatsakanian, Head of the Responsible Investment and Impact department – aims to positively contribute to the United Nations’ goals through its investee companies. It will report the outcomes and impact results of the underlying investments on a quarterly and annual basis.

SRI products will dominate 2018, according to the Chair of the Luxembourg fund industry association ALFI, Citywire reports. Denise Voss is quoted as saying. “SRI is one of ALFI’s key pillars for the year ahead. We have UCITS, we have alternative investment funds and we have responsible investing which has been a focus since 2006”. She also expressed her concerns around ‘greenwashing’, stating that it is a real challenge to identify what’s responsible and what’s not.

Sweden’s Strukturinvest is meeting with investors ahead of the launch of its Glacier Impact hedge fund in May. The vehicle, run by Ulf Erlandsson – former bond trader at Swedish pension fund AP4 and quant strategist at Barclays Capital – will specialise in ‘climate activism’ in the fixed-income space, including long-short strategies, green bond trading and opportunistic shorts on brown issuers. Erlandsson told RI that climate change would “profoundly shift the relative economic value of certain assets and technologies”, adding: “There are and will be profitable opportunities in these shifts. At the same time, we are morally obliged to do our utmost to combat global warming.” Target returns are 4-5% over risk-free rates.

The Emerging Africa Infrastructure Fund (EAIF), the European government-backed fund, which forms part of the Private Infrastructure Development Group (PIDG), has announced it has agreed to finance the largest solar plant in West Africa with French renewable energy firm Akuo Energy. The €78m 50MW Akuo Kita Solar power plant will be built in Kita, southern Mali. The EAIF’s funding comes from the governments of the UK, The Netherlands, Sweden and Switzerland, as well as European development banks, KfW and its Dutch equivalent, FMO.

Dutch social investor Goodwell has announced that it has raised €20m for investments in Sub-Saharan Africa’s “inclusive economy”. It will invest the funds “in young, fast growing companies that offer products and services to un(der)served people to meet their increasing demand for affordable and quality basic products”. Half of the fund will be invested in financial services, the other half in agriculture, health and sanitation, energy, transport and education.Aberdeen Standard Investments has launched a fund that aims to generate a financial return over the long term by investing in companies which promote and implement good employment opportunities and practices. The UK Equity Impact – Employment Opportunities Fund, is a collaboration with Big Issue Invest, the social investment arm of The Big Issue and will be managed by Investment Director Lesley Duncan.

The Swiss corporate governance index launched a year ago by Ethos now has CHF581m (€500m) of assets linked to it. The Ethos Swiss Corporate Governance Index (ESCGI) was the first stock market index dedicated to corporate governance of Swiss companies. The assets come mainly from Swiss pension funds Ethos said.

The Spanish securities regulator (Comisión Nacional del Mercado de Valores or CNMV) approved two SRI funds run by Santander Asset Management.
Santander Sostenible 1 is labelled as an “ethical fixed income mixed fund”, whose exposure to equity cannot exceed 25% of assets; while Santander Sostenible 2  is labelled as an “ethical equity mixed fund”, and under “normal market conditions” it should be 50% fixed income and 50% equities. The prospectus estates the funds comprise ESG mandates, which require asset selection based on ESG analysis and asset managers to have a “track record of good sustainable investment methodology”.

John Laing Environmental Assets Group (JLEN), the listed environmental infrastructure fund, has made a c.£11m investment in an anaerobic digestion plant in the UK. The investment in the 5MW Icknield Farm facility consists of the provision of a debt facility to repay existing loans and acquisition of a minority equity stake from private individuals who developed the project.

US asset manager Krane Funds Advisors has launched an electric vehicle, future mobility exchange traded fund (ETF). The KraneShares Electric Vehicles and Future Mobility ETF relies on an index created by German provider Solactive, which aims to mirror the performance of companies – including Tesla, Baidu, Texas Instruments, and Samsung – that are actively engaged in the development of future mobility solutions. The Solactive Electric Vehicles and Future Mobility Index, which has a minimum market capitalization of $500m, is composed of 64 globally listed companies, including China A-shares listed on the Shanghai and Shenzhen Stock Exchanges.