Responsible Funds, July 4: new Africa Climate Change Fund launches first call for proposals

The round-up of responsible funds news

The new Africa Climate Change Fund (ACCF), which is housed within the African Development Bank), is launching its first call for grant proposals. African governments, NGOs, research and regional institutions are invited to apply by August 8. Grants will start from US$250,000 and will be dedicated to climate finance readiness projects, programmes or activities. The fund was established in April 2014 with an initial contribution of €4.725m from the German government; the aim is to scale up climate smart development in African countries.

Nordea Investment Management, which has €130bn of assets under management, has reportedly started measuring the carbon footprint of its funds in response to demand from pension funds, private banks and wealthy individuals on more transparency over carbon exposure of their investments. Nordea’s fund documentation for products such as the Emerging Stars fund shows that the portfolio is 6% less carbon intensive than the MSCI Emerging Markets index, its benchmark.

The Pictet Water fund outperformed its benchmark for May, with absolute performance of +4.05%. The fund has added to its position in water products firm AO Smith, on the back of opportunities in China and stock weakness. The new position in Mueller Water was increased, as were stakes in Sabesp and California Water Service.

The TriLinc Global Impact Fund, an impact investment fund that provides loans to SMEs in the developing world, has approved a commitment of $5m to an Argentine beef producing and processing company. TriLinc has funded $4m as part of a $5m revolving trade finance facility at 11.98% interest to the Argentine company which plans to use the finance to create new jobs and support the country’s economic development through increased exports, largely to European buyers.Steyler Bank, an ethical bank active in the German and Austrian markets, says a sustainable bond fund it launched one year ago has turned in a good performance so far. According to the bank, its “Steyler RuN – Renten” product returned 6.6% in the 12 months to June 30 and took in €36m in assets from institutional and private investors. Steyler also distributes a sustainable equity fund, which has gained 24% since its inception in October 2012. The advisor for both Steyler-branded funds is Warburg Invest, the asset manager for German private bank M.M. Warburg. A portion of the fund’s earnings was used to finance projects in developing countries, such as a €41,000 grant to a hospital in South Sudan for solar panels. Link (German)

Two private pension funds from Australia and Germany and the sovereign wealth fund of Azerbaijan are among eight investors who have ploughed $418m into the IFC Catalyst Fund, which will invest in private equity funds and companies focused on climate-related investments in emerging markets. The IFC Management Company manages the fund, which also attracted investment from the governments of the UK, Canada, Norway; the Japan Bank for International Cooperation; and the IFC.

The Public Pension Agency of Saudi Arabia; the Public Investment Fund of Saudi Arabia; the Ministry of Finance of the Kingdom of Bahrain; and the Ministry of Finance of the Sultanate of Brunei Darussalam have collectively invested $750m into an infrastructure fund launched by the Saudi Arabia-based Islamic Development Bank. The bank is aiming to raise a total of $2bn for the IDB Fund II.

The UBS Sustainable Global Leaders fund, which invests in companies that place an emphasis on sustainability, has returned 11.72% for the year to the end of May, according to its latest Fact Sheet. The €7.7m fund has returned €30.72% over a three-year horizon.