Responsible Funds, June 1: Launches from Amundi, Ambienta, Beyond Advisors + Denmark extends ecolabel to funds

The latest ESG fund launches and market news, bite-sized.

Milan based ESG private equity firm Ambienta has closed its third fund after securing €635m. It closed €135m over its initial target, with demand exceeding €1bn. Ambienta III, which aims to capture “long-term environmental growth trends”, saw investments from around 50 global investors representing €10trn in assets, including pension funds, insurance companies, fund of funds, banks, and foundations.
The Nordic Swan Ecolabel, normally used on household products like laundry detergent, paint or furniture, has now been added to domestic investment products, with four of Triodos Investment Management’s SRI funds becoming the first to receive the label in Denmark. It evaluates investment options according to factors such as environmental footprint and social responsibility. Karen Dahl Jensen, Product Development Manager at Nordic Ecolabelling, said: “Investment funds labelled by the Nordic Swan Ecolabel must meet 25 mandatory requirements that govern the various ways a fund can impact companies. This will include, among other things, inclusion or exclusion of companies as well as transparency about the fund’s investments.” The EU is currently considering expanding its European eco-label to financial products too.
Amundi’s exchange traded fund (ETF) arm has launched a new ESG fund offering investors access to USD denominated corporate bonds. The Amundi Index US Corp SRIUCITS ETF DR, which tracks the Bloomberg Barclays MSCI Corporate SRI index, screens against investments in alcohol, tobacco, military weapons, gambling, adult entertainment, companies involved in genetic engineering, and nuclear power.
The Luxembourg-based International Climate Finance Accelerator (IFA) – an incubator for new green fund managers with a measurable climate impacts – has announced the first cohort of winning fund managers that it will support. Over the next three years, the Luxembourg government will contribute €2m to the initiative, with another third from private companies. The five fund managers selected for support out of a total of 26 applications are: Empower New Energy, which invests in decentralised renewable energy in Sub-Saharan Africa; Impact Capitalyst, which will invest in businesses and projects that enable ‘climate smart’ and socially-inclusive agriculture in sub-Saharan Africa; Serimus Hydro, a Luxembourg-based asset manager for small hydroelectric power plants in Europe and Latin America; Uberis, a VC fund investing in entrepreneurs for technology in agriculture, access to energy & clean water, waste recycling, female empowerment and climate change in Southeast Asia; Lightsmith Group, which invests in technologies and solutions for climate adaptation and resilience.
Beyond Advisors has launched a new stock index focused on vegan and climate change criteria. The US Vegan Climate Index screens US large cap stocks for activities that are incompatible with vegan and climate-conscious investment approach. Criteria for exclusion include: animal-derived products, animal testing and animals in sport and entertainment; fossil fuel, energy production from fossil fuel, and other environmental concerns; military and defence; and tobacco.Hermes Investment Management – the £33.6bn asset manager recently sold to US house Federated – has launched the Hermes Unconstrained Credit Fund, adding to its global fixed income product offering. Seeded by investors including Quilter Multi-Asset, the UCITS Fund has secured investor commitments of £185m (€212m) and will invest in investment-grade and high-yield bonds, loans, credit-default swaps, asset-backed securities and other credit derivatives, it said. ESG will be “priced in” to investments, Hermes added. Andrew Jackson, Head of Fixed Income, and Fraser Lundie, Co-Head of Credit and Lead Credit Portfolio Manager, will manage the fund.
A $25m seed fund for investment in tech startups has been launched by the centre for innovation, incubation, and entrepreneurship (CIIE) at business school the Indian Institute of Management Ahmedabad (IIMA), according to reports. The fund, named the ‘Bharat Inclusion Initiative’, aims to mentor and invest in early-stage tech startups in areas such as financial inclusion, education and health over the next three to four years. The initiative has secured an initial commitment of $12.5m from Tata Trusts, the Bill & Melinda Gates Foundation, the Michael & Susan Dell Foundation and Omidyar Network.
Sustainable investment funds in Switzerland saw growth of 47% last year, according to a study funded by Credit Suisse, Inrate, LGT, Pictet Asset Management, Raiffeisen and Vontobe. Overall, growth of assets managed by institutional investors more than doubled, increasing 128% over the year, and mandates in the space rose by a quarter. Sustainable investments managed by pension funds, insurers and other institutional investors represent CHF238.2bn, 61% of the country’s whole SRI market.
The Pension Consulting Alliance (PCA) has published a report on ESG Equity indexes looking at 12 sustainability indexes from FTSE/Russell, MSCI and S&PDJI. The report found that eight of the 12 beat their parent index gross return, while six outperformed on risk-adjusted returns. The report reads: “In just the last five years, these indexes have matured sufficiently to offer a new range of options that PCA believes can be seriously considered by institutional investors.”
Two years after the Storebrand Group launched its first fossil-free fund, it has reported a total of $7.6bn AUM in fossil free investments. Storebrand Asset Management CEO Jan Erik Saugestad said: “The development is a clear signal that a true shift in sustainable investments is on its way and that our clients wish to further act upon their growing concern for climate change.”