Responsible Funds, February 3: the round-up of ESG funds news

The Pictet Timber fund says it “clearly outperformed the World equity market” over the fourth quarter of 2011. Best performers in the pure timberland sector were Weyerhaeuser and Rayonier. The best contributor overall was Brazilian packaging firm Klabin. The fund completely sold out of pulp companies Suzano, Altri, Fibrek and Canfor Pulp. “We like the biological growth characteristic of timberlands, an asset that grows in size and value over time, regardless of economic conditions,” Pictet says.

Overweight positions in commodities and utilities and the “great underweight” in energy hit the Swiss Canto Equity Fund Climate Invest in the last three months of 2011. But the underweight financials and overweighting transport were positive.

There’s a “far better outlook” for environmental investing in 2012, says Charlie Thomas, manager of the €7m Jupiter Climate Change Solutions fund. “This is being driven by closer price parity between alternative and mainstream energy suppliers and growing demand for environmental solutions from emerging markets,” he says in a commentary. The fund has returned 30.5% over a three-year view.
Germany-based Wermuth Asset Management has launched a €200m Russian clean technology fund, according to reports. Wermuth is targeting returns of 30% a year for the Tatarstan Cleantech Fund (TCTF), Reuters reported.

The new Azure Global Microfinance fund has been launched by Swiss boutique Azure Partners. The Luxembourg-domiciled fund will invest 65% in debt funds and 25% in private equity – targeting annual returns of 5-6%. Link*ING’s €80.37m Invest Sustainable Equity* sub-fund returned 11.39% in the fourth quarter, beating its MSCI World benchmark. The Luxembourg-registered fund invests in companies pursuing a sustainable development policy and combining respect for social principles.

The Sparinvest Ethical Global Value fund made four new investments in the fourth quarter of last year. They were Brother Industries (Japan, printers), Delhaize Group (Belgium, supermarkets), Esprit (Hong Kong, apparel) and Kyocera (Japan, electronics). The fund returned 1% in the quarter, taking its full-year return to -18.35%, versus a -2.38% return for its MSCI World benchmark.
The new ‘MyFolio’ fund range from United Nations Principles of Responsible Investment signatory Standard Life Investments has reached the £1bn (€1.2bn) funds under management milestone.
Standard Life’s £118.6m UK Ethical Fund (institutional) returned -4.9% in 2011, against a -6.8% return for the benchmark, according to fund documents. The fund, managed by Lesley Duncan, invests using strict ethical criteria. It excludes companies which fail to meet them – and includes those seen as making a positive contribution to society.
UN PRI signatory Legal & General Investment Management has launched a new fund for the “long-term pension investor”. The new LGIM Diversified Fund – which does not take short-term tactical positions – is available to both defined benefit and defined contribution investors.