Responsible Funds, January 18: Merseyside, Minnesota, Robeco, RobecoSAM, UK Climate Investments

Merseyside Pension Fund has invested £400m in a new “smart” sustainability fund created by index provider FTSE Russell, as part of the £9bn UK local government pension scheme’s Climate Risk Strategy. The All World Equity Climate Balanced Multi-Factor Index Sub-Fund, which will be managed by State Street Global Advisors, incorporates climate change considerations in listed equity investments through three “parameters”: carbon efficiency, fossil fuel reserves, and green revenues.

Minnesota State Board of Investment, which oversees the US state’s public pension funds, worth $97bn, has signed up to the UN supported Principles of Responsible Investment this month. The Midwestern state fund also included ESG in its recently updated (June 2018) investment beliefs, which outlines its use of proxy voting to express its “positions relating to specific ESG issues”.

RobecoSAM has renamed its Global Sustainable Impact Equities strategy to become RobecoSAM Global SDG Equities, reflecting its focus on the UN Sustainable Development Goals. The firm said: “Since launch in December 2017, it has produced competitive returns in volatile market conditions.” Head of Investments Rainer Baumann continues to manage the strategy, whose investment process remains unchanged.

Robeco has expanded its factor investing range with the launch of a strategy which invests in stocks in developed markets and offers “a significantly improved sustainability profile”. Robeco said the Robeco QI Institutional Global Developed Sustainable Multi-Factor Equities strategy was created “on client demand” and in close cooperation with RobecoSAM.

FTSE Russell has launched a new index series tracking Chinese green bonds. The FTSE Chinese (Onshore CNY) Green Bond Index Series will benchmark securities whose proceeds are specifically used to finance climate or environmental projects in mainland China.

CBRE Global Investors has reportedly secured almost £250m from 13 institutional investors for its first social and affordable housing fund. UK social investment institutional Big Society Capital was among investors bring the fund to its first close. The CBRE UK Affordable Housing Fund will invest in social and affordable rented housing, shared-ownership properties, homeless hostels and housing for ‘key workers’UK Climate Investments, a joint venture between the Green Investment Group and the British government, have announced a planned R500m (€31.7m) cornerstone investment in a dedicated African renewable energy “yieldco” called Revego Africa Energy Ltd. Managed by a newly incorporated majority black-owned fund manager, the investment vehicle will seek to acquire equity in operational renewable energy projects across sub-Saharan Africa.

Brooks Macdonald, the £12.8bn investment manager, now has a responsible investment service on some of its platforms. The service, called “Advance”, is available as a Managed Portfolio Service (MPS) across three risk profiles: low to medium risk, medium risk, and medium to high risk.

The board of the African Development Bank Group has approved a $32.5m equity investment in a fund aimed at delivering viable renewable energy projects to the African market. Climate Investor One’s (CIO) Construction Equity Fund (CEF) will provide capital and technical assistance for early stage project development, invest equity for the construction of projects; and provide debt at competitive terms. The Bank’s investment in the fund will be managed by Climate Fund Managers (CFM), a joint venture between Netherlands Development Finance Company (FMO) and Sanlam InfraWorks.

Zevin Asset Management, the US SRI house, has reported that its Global Appreciation non-taxable composite decreased by 8.46% net of fees during the fourth quarter, while its Global Appreciation with Income non-taxable composite decreased by 6.17% net of fees. Its Global Equity strategy decreased by 11.35% net of fees in the quarter, compared to a decrease in the MSCI All Country World Index (ACWI).

Eagle Asset Management, an affiliate of Carillon Tower Advisers, has launched the Eagle SMID Cap ESG Select institutional strategy, which considers ESG factors in small- and mid-cap companies while trying to optimize long-term returns and minimize risk. The Eagle SMID Cap ESG Select institutional strategy. Jason Wulff has been named lead portfolio manager of the strategy.

The European Investment Bank (EIB) and the province of Limburg in the Netherlands will both invest €75m in the “Duurzaam Thuis” stimulation fund. The initiative is meant for private citizens who can borrow money for future proofing their homes. It is the first time the EIB has invested in a fund that will lend directly to citizens, rather than a business or public sector counterpart.