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Responsible Funds, May 9: Irish government unveils energy efficiency fund

The round-up of responsible funds news

Irish Energy Minister Pat Rabbitte has launched the new €70m National Energy Efficiency Fund with investment firm Sustainable Development Capital. It’s hoped the fund will act as a catalyst to develop energy efficiency projects in the Irish market. The fund has secured first close of €35m with a capital commitment of €17.2m from the Irish Government, together with a combination of private sector capital from London & Regional Properties (€12.8m) and industrial group Glen Dimplex (€5m). It is anticipated that as much as €300m leveraged funding will be delivered over the next three years.

The African Development Bank is reportedly planning to launch a $3bn infrastructure fund. The Financial Times, citing AfDB documents, said the AfDB was aiming to raise money from regional and non-African pension funds, insurance groups, sovereign wealth funds and institutional investors for the Africa50 offering. The FT added the AfDB would invest $500m, with approval for the launch set for its annual meeting in Rwanda.

BlackRock’s €96m iShares Dow Jones Eurozone Sustainability Screened fund has returned 22.72% for the year to the end of April, according to fund documents. The fund, benchmarked against the Dow Jones Sustainability Eurozone Index ex Alcohol, Tobacco, Gambling, Armaments & Firearms and Adult Entertainment, was launched in 2006. Top three holdings are Total, Banco Santander and BASF. Cumulative performance since inception is 20.56%.

Activist hedge fund JANA Partners is reportedly to stop accepting new investments into its $4.7bn Nirvana funds. Reuters was citing a quarterly letter to investors as saying that “significant growth” in its capital base means it would be prudent to close the funds to outside investments. JANA has in the past teamed up with investors such as the Ontario Teachers’ Pension Plan to push for governance reforms at companies such as McGraw-Hill.US sustainable funds firm Pax World Management, investment adviser to Pax World Funds, has said that its Pax World Growth Fund has divested its fossil fuel holdings and that it would “henceforth pursue a fossil fuel‐free investment strategy”. Instead of fossil fuel companies, the fund will invest in companies developing solutions to global sustainability challenges, including climate change, water, food and health care. Examples include LED lighting firm CREE, auto parts firms BorgWarner and Valeo, water purification firm Pall and GPS navigation firm Trimble. The Pax World Growth Fund is the second Pax offering to pursue a fossil fuel‐free investment strategy, after the Pax World Global Environmental Markets.

The Global Climate Partnership Fund, managed by Deutsche Asset and Wealth Management, has seen its total investments rise by 45% to US$228m. The portfolio of investments is primarily in the form of loans to local banks that now include banks in 10 countries on four continents. On average, funded projects created a 42% carbon emission savings, well above the fund’s minimum target of a 20% carbon savings, Deutsche said. The fund is structured as a public-private partnership; the first private investor (a German doctor’s pension fund) made a $30m investment into the fund in 2012. Germany’s Federal Environment and Building Ministry increased its investment to $55.5m and the UK’s Department of Energy and Climate Change became a new investor with $50m.

Jupiter’s $15m China Select fund, which was renamed from China Sustainable Growth in March, has registered 19.2% growth in the year to the end of March, according to a new fund update. The fund is benchmarked against the MSCI Zhong Hua Index and invests in firms “well positioned to benefit from secular trends associated with the environmentally, socially and economically sustainable development of Greater China”.

The European Bank for Reconstruction and Development (EBRD) and the Islamic Development Bank’s private sector arm plan to launch a $120m fund to support small businesses in the southern and eastern Mediterranean, according to reports. The fund would finance SMEs using equity and quasi-equity structures.