Responsible Funds, November 21: US sustainable funds almost double over last two years – US SIF

The round-up of the latest responsible funds news

US assets that are managed sustainably, responsibly or for social impact have almost doubled over the last two years, says US sustainable investment forum US SIF. According to US SIF’s latest report on its home market, the assets totalled $6.57trn (€5.3bn) at the start of 2014, up 76% from the $3.74trn reported two years earlier. As a result, assets managed in socially responsible investment (SRI) fashion now account for more than one out of every six dollars under management in the US, the US SIF said.

Swiss banking giant UBS has unveiled a sixth socially responsible exchange traded fund (ETF) for the UK retail market. The new Socially Responsible UCITS ETF tracks an MSCI index that includes UK companies that score highly on ESG (environmental, social and governance) issues. The MSCI index also excludes firms involved in alcohol, tobacco, gambling, weapons, nuclear power, pornography and genetically modified organisms. “With this UK market-focused SRI listing, we continue in our commitment to offering ETFs that enable people to invest in companies that meet rigorous ESG standards in an easy-to-access structure,” said Andrew Walsh, Head of ETF Sales for the UK and Ireland.

Legal & General Capital and Patron Capital Partners, the €2.5bn investment firm, have established a new strategic partnership to identify and invest in long-term, operational, real estate and infrastructure backed investment opportunities “with a positive social impact”. Patron will act as the primary originator and day-to-day investment manager of the new partnership, known as the Perpetual Opportunities Partnership (“POP”). The investments will be made both by Legal & General Capital, L&G’s principal investment team, and Patron Capital as co-investors with Legal & General Capital being the majority stakeholder.

Desjardins Wealth Management has launched, a website designed to make information about socially responsible investing (SRI) more accessible. The platform is an extension of Desjardins Group’s Education and Cooperation Program, for which Desjardins has earmarked 1% of its annual surplus earnings. Desjardins Group is the leading cooperative financial group in Canada and the fourth largest cooperative financial group in the world with assets close to C$227bn (€162.6bn).

Lok Capital, a Mauritius-based microfinance fund specialist, is reportedly seeking to raise $100m for a new fund that would focus on promoting financial inclusion in India, with agriculture and energy secondary priorities. According to the Economic Times of India, the fund has set April 15 as the deadline to for its first closing. Founded in 2000 with support from the US non-profit the Rockefeller Foundation, Lok Capital has $87m in assets in its microfinance funds.Former Australian treasurer and chairman of the country’s sovereign wealth fund Future Fund Peter Costello has defended its fossil fuel investments to the Australian senate in Canberra, saying it would be “strange” and “extraordinary” for a country which exports oil and gas to divest from such industries. It follows pressure from the Australian Green Party for the AU$104.8bn (€71.5bn) Future Fund to disclose its analysis of carbon and climate risks in its investment portfolio, and ultimately divest from fossil fuels. The chair of the Future Fund does not normally attend such hearings, but Costello agreed to attend. He told the meeting: “I think it would be extraordinary if the government of Australia in its sovereign wealth fund said it was going to pull out of coal or gas or oil. These are very, very important industries to Australia.”

UK-based online broker Interactive Investor has launched a new site that allows investors to view ESG-based investments called the Values Based Investor Centre. Boutique firm Alquity’s range of funds is first on the list. The Values Based Investment Centre will also feature new issues of equities and bonds which focus on “Values Based Investing”, an investment philosophy which considers criteria based on investors’ values, alongside financial returns, when selecting an investment opportunity.

The Macquarie Greater China Infrastructure Fund (MGCIF) has, along with two other investors, paid $225m (€179m) to acquire a 45% stake in JinkoSolar, China’s leading solar module maker. According to news reports, the investment will enable JinkoSolar to lift its project development pipeline to more than 800MW from 600MW currently. “We expect the MGCIF fund to help us further tap into the global solar power market through the Macquarie Group’s global resources and network,” Li Xiande, Chairman of JinkoSolar, was quoted as saying. The other two new investors in JinkoSolar are China Development Bank International (CDBI) and New Horizon Capital, a private equity fund that was founded by the son of former Chinese Premier Wen Jibao. Link

ECM Asset Management, a unit of US bank Wells Fargo, is launching a new European infrastructure debt fund for institutional investors with a target volume of €750m. ECM said the sectors the fund would invest in were renewable energy, social infrastructure, transport, power, oil and gas, as well as telecoms and utilities. The fund’s geographical area includes the UK, Germany, France, Belgium, Netherlands, Italy and Spain. “European infrastructure investments are expected to be approximately €2.5 trillion through to 2020. This is a great time therefore to take advantage of the sizeable supply and demand gap present in this space,” said Nicola Beretta Covacivich, Head of Infrastructure Finance at ECM.