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Responsible Funds, July 21: Eaton Vance’s Calvert to launch short-term fixed income ETF

The latest responsible funds news.

Calvert Research and Management has filed a registration statement with the Securities and Exchange Commission for a new exchange-traded managed fund investing in short-term income investments, the Calvert Ultra-Short Income NextShares. NextShares is a new way to invest in actively managed strategies, Calvert said, adding that the first NextShares fund began trading on NASDAQ in February 2016. Calvert, the SRI firm now part of Eaton Vance, said the fund will invest in short-term bonds and other income-producing securities and would be guided by the Calvert Principles for Responsible Investment, which provide a framework for considering environmental, social and governance factors.

The Environment Agency Pension Fund has achieved a 19.6% investment return for its active pension fund for the year to March 2017. Emma Howard Boyd, chair of the Environment Agency, reportedly said the scheme’s adoption of ESG was partly responsible for its improving financial situation. The EAPF’s annual report focuses on its approach to responsible investment, including its decarbonisation commitments and 25% allocation to sustainable and clean tech investments. It also reports along the draft recommendations from the Task Force on Climate-Related Financial Disclosures. It comes as the Environment Agency Pension fund has this week joined the Brunel Pension Partnership Local Government Pension Scheme – a $27.5bn investment company that will manage the assets of the EAPF and ten other LGPS funds.

The European Investment Bank (EIB) and Banco Santander have signed a risk-sharing agreement to help the Spanish banking group provide at least €400m in financing for new renewable energy projects. This agreement was one of two signed between the EIB and Banco under the EU’s long-term growth initiative, Investment Plan for Europe. The second agreement aims to drive economic growth and job creation by raising up to €1.5bn to finance Spanish SMEs – with the EIB participating in a €500m loan portfolio.

A “biblically responsible impact investment firm” that excludes LGBT-friendly companies as part of its strategy, has launched what it claims is the first faith-based fixed-income ETF. Inspire Investing has launched the fund to invest in corporate bonds “of companies aligned with biblical values”. This includes companies involved in clean water project, anti-human-trafficking initiatives and refugee support, as well as bible distribution. It uses an in-house universe “so as to avoid investments in companies involved in immoral activities such as abortion, pornography [and] human trafficking”, it said. Inspire Investing hit the headlines earlier this year when it launched its first two equities ETFs, which bar investments into companies with “any degree of participation” in the “LGBT lifestyle”.A climate fund managed by Swiss-based responsAbility Investments AG has entered into collaboration with the Energy, Climate and Technology branch of the UN Environment. The partners will collaborate on developing country baselines for specific technologies to establish benchmarks for both sustainable energy policies and energy efficiency financing. “The strategic partnership will allow responsAbility to obtain first-hand information on the development of sustainable energy policies that boost the demand for green products financed through the climate fund’s partner institutions,” it said in a statement.

Pax Ellevate Management, the US ‘gender lens investing pioneer’, has announced that its Global Women’s Index Fund has outperformed its benchmark, the MSCI World Index over the last three years, adding support to the link drawn between female representation and company performance. Since 30 June 2014 the fund’s institutional class shares have returned 5.93% compared with the MSCI World Index return of 5.24%.

Strong demand from UK pension funds has taken BlackRock Real Assets’ Renewable Income UK fund to £1.1bn after securing £475m in additional commitments in its third opening – with 70% of the additional capital came from existing clients . The fund has already invested £600m in 40 solar and wind projects in the UK.

Bain Capital Double Impact, the impact investing arm of Bain Capital, launched in 2015, has announced the completion of its first two investments in “mission-driven companies”. The Boston based private investment firm has chosen Living Earth, a US commercial recycler of organic landscaping materials, and Impact Fitness, an affordable health club tailored for underserved communities in Indiana and Michigan, as its first companies. The financial terms were not disclosed. 

The Livelihood Funds has launched new €2m Madagascar based impact investment fund to support vanilla farmers. The Livelihoods Fund for Family Farming, created by multinationals Danone, Firmenich, Mars, and Veolia, aims to improve farmers’ productivity and revenues whilst preserving Madagascar’s environment. Launched in 2015 the Livelihood Funds plans to invest €120m to build sustainable agricultural supply chains in Africa, Asia, and Latin America over the next 10 years.
The UN established Green Climate Fund (GCF) has approved the accreditation of six new partners at its second Board Meeting in South Korea. Set up in 2010 under the UN Framework Convention on Climate Change, the fund takes donations from wealthier nations to finance initiatives in less-developed countries. The new partners include Japan’s Bank of Tokyo-Mitsubishi UFJ Limited, India’s Small Industries Development Bank, and Morocco’s CDG Capital S.A.. In May 2017 the GCF put out a $500m request for proposals to find “high impact” climate projects.