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Responsible Funds, Nov. 22: Canada’s AGF merges SRI funds into other offerings

The round-up of responsible funds news

AGF Management, the listed Canadian fund giant with around C$37bn (€26.1bn) in total assets under management, is merging its social values funds into its other funds. The C$34m Social Values Equity Fund will be merged into the Global Equity Fund while the C$52.5m Social Values Balanced Fund will merge with the Traditional Income Fund. The SRI funds combine financial analysis with ESG screening by Martin Grosskopf, Director of Sustainable Investing at AGF subsidiary Acuity Investments. The changes, part of a wider “ongoing review” of the fund range, are expected to occur in or about May 2014. AGF’s Clean Environment fund will continue. Announcement

Schroders’ $237.6m (€176.6m) Global Climate Change Equity fund has returned 24.3% in the year to the end of October, against a benchmark (MSCI World – Net Return) return of 21.9%. Over the six-month view, it has returned 14.4% (benchmark: 9.7%). The fund, which invests in companies globally “which will benefit from efforts to accommodate or limit the impact of global climate change”, is managed by Simon Webber and Giles Money.

The €48.33m RobecoSAM Sustainable Global Equity Fund outperformed the MSCI World Index in October, returning 4.27% (benchmark: 3.47%). For the year to date, the fund has returned 21.76% (18.2%). The fund invests globally in companies that are leaders with respect to sustainability. During the month it added Japan-based energy firm Inpex to its portfolio, while selling its positions in industrial group Caterpillar. Link

The Advocacy Fund from Australian Ethical recently bought shares in mining firm BHP Billiton to support the election of former mining executive turned environmental campaigner Ian Dunlop to its board. The fund “fully supports his nomination” and was pleased to see other investors such as the giant US fund CalPERS backing him too. [In the event, Dunlop’s nomination at both BHP’s UK and Australian annual general meetings was unsuccessful.] Link*FNG, the sustainable investment forum for Germany*, Switzerland and Austria, is planning to roll out a “quality label” for sustainable investment funds distributed in those markets by the end of 2014. Speaking at the VFU’s sustainable finance conference in Bonn this week, FNG board member Sabine Pex said the group had already defined the criteria that the funds would have to meet in order to be labelled as sustainable. “We came up with a concept for the criteria that we think the entire industry can agree on,” said Pex, adding that the criteria included the exclusion of controversial weapons such as cluster bombs, nuclear power, as well as firms that violate human rights and labour standards. The FNG will submit its concept to its members, many of whom are fund companies, for approval. According to Pex, this process could take up to a year.

The €25.1m Vontobel Clean Technology fund returned 18.0% in the year to date (end-October), compared to a benchmark (MSCI World Index TR net EUR) return of 18.2%. The fund invests in companies offering technologies and innovative solutions to mitigate climate change and reduce air and water pollution.

Indices

The Turkish stock exchange, the Borsa Istanbul, is to create a sustainability index in partnership with ESG research firm EIRIS. The BIST Sustainability Index will be launched in early 2014. Assessment of corporate performance for the new index will be based on publicly available information against chosen ESG indicators that are derived from EIRIS’ Global Platform. Exchange Executive Vice President Mustafa Kemal Yılmaz said companies would be able to benchmark themselves to improve their ESG performance while investors would have a “new instrument to develop new investment products and a showcase to select and invest in the companies with better sustainability performances”. Research for the index assessment will be completed by EIRIS and a local research organisation, the Corporate Governance Forum at the University of Sabanci.