Responsible Funds, May 25: State Street, RobecoSAM, IFM and more

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

The Luxembourg Stock Exchange has launched a dedicated platform for SRI funds on its Luxembourg Green Exchange (LGX). At launch, LGX displays 11 SRI funds which are managed by Humanis Gestion d’Actifs, Investing for Development, NN Investment Partners, Selectra and Sparinvest. The LGX displays more than 170 green, social and sustainability bonds which amount to over $100bn.
Robeco and its sustainability arm RobecoSAM have announced the launch of the RobecoSAM Global SDG Credits strategy, which aims to help achieve the UN SDGs and outperform the Bloomberg Barclays Global Aggregate Corporate Index. The strategy integrates financially material ESG information, applies an extensive values-based exclusion policy and will not invest in bonds from corporates that have a negative SDG rating. The strategy will invest in green bonds as well as conventional bonds. Jan Willem de Moor will be the Portfolio Manager.
A number of RobecoSAM’s existing sustainability funds have underperformed their benchmark in the year-to-date, according to latest information. The Dutch specialist asset manager, whose CEO stepped down in recent weeks, saw its Global Small Cap Equities fund return -3.91% so far this year, against its benchmark of -1.43%. Its Smart Materials GBP fund showed -7.48% performance, compared with -1.93% by its benchmark. Its Sustainable Global Equities EUR fund returned -1.36% in the same period, against -0.76% from the benchmark. Its Sustainable Water Fund GBP saw -4.41% performance, compared with -1.93%. Outperforming its benchmark, on the other hand, was its Sustainable Healthy Living EUR fund, which returned -0.15% compared to -0.76% from the benchmark.UK-listed passive funds prioritising green and socially responsible companies reached record numbers in May, the FT reports. Information from the London Stock Exchange showed that more exchange traded funds (ETFs) with environmental or social goals entered the market this month than in any previous month, testifying to a growing demand. 2018 is already a record year for such listings: Ten ETFs categorised as environmentally or socially responsible have been listed in London so far this year – with eight coming in May alone. By contrast, just six were listed in the whole of 2017.
State Street Global Advisors (SSGA) has reportedly rebranded its $398m Multi-Factor Global Equity fund, following the integration of ESG screens as of May 22. Following this, all assets will be transferred to the ESG Multi-Factor Global Equity Fund Sicav. The strategy uses a systematic process which incorporates value, size, low volatility, quality, dynamism in addition to ESG factors.
The Sorenson Impact Center at the University of Utah has announced the successful first close of their $8.2m University Venture Fund — Impact Investing (UVF II), an impact investment fund run by students at the university. The fund will invest in equity and debt, and is able to provide other financing arrangements such as pay-for-success. This follows on the UVF, the original iteration of the fund, which invested in 24 companies and has experienced 11 exits: five IPOs and six acquisitions.
IFM Investors has made its first foray into the social and affordable housing sector with a £60m private debt investment in UK housing association A2Dominion. A2Dominion will use the funding from the privately-financed investment, issued as a nine-year floating-rate note (FRN) due 2027, in its development of mixed use housing that adds to its social and affordable housing portfolio. A2Dominion owns and manages 37,000 properties, including social, affordable and private homes, focusing on developments in London and southern England.