Allspring Global Investments has launched two sub-funds – the Climate Transition Buy and Maintain Plus 2025-2029 Fund and the Climate Transition Buy and Maintain Plus 2030-2034 Fund. Clients of global professional services company Aon provided £100m (€120m) of seed capital for the launch of the funds.

The two new funds complement Allspring’s existing climate transition fixed-income suite through which Allspring manages over £4bn across a range of global fixed-income products, including investment grade, high yield, short duration, buy and maintain, allowing different client needs and risk appetites to be met, the firm stated.

Fixed income is one of Allspring’s core capabilities, with three-quarters of its total assets (£339bn of £440bn) allocated to fixed income.

Allspring has been managing buy-and-maintain mandates for more than 20 years and manages £18bn for clients globally.

Following the success of Allspring’s Climate Transition Global Buy and Maintain Fund, launched in August 2023, these two new maturing funds are a “natural extension in helping clients meet their cash flow needs”, the firm has said.

The funds’ ‘plus’ element identifies the differentiation from traditional buy-and-maintain strategies, whereby these funds can allocate up to 25% to sub-investment-grade credit in a risk-controlled manner, seeking to provide investors with an enhanced yield, which is particularly attractive in today’s market environment, Allspring said.

The funds apply a climate-transition approach to help clients achieve their net-zero ambition while delivering on their financial objectives. The funds also integrate ESG criteria to meet wider responsible-investing commitments, it added.

Simon Rhodes, associate partner and head of liquid credit content at Aon, said: “Meeting our clients’ needs through collaboration and innovation is at the heart of what Aon does. In an environment where market challenges are ever greater, delivering impactful investment solutions is increasingly important.”

He said the new funds are expected to provide a “valuable additional return contribution to our clients’ portfolios”.

Vicky Given, senior consultant relations director at Allspring, added: “Most UK defined benefit pension schemes are in a much stronger funding position than they have been historically and although ‘run-on’ is not a new concept for trustees, they are now better placed to decide what’s best for their scheme. Beyond defined benefit, we continue to explore future opportunities for how our climate transition fixed-income suite can solve for the ever-evolving needs of UK defined contribution and decumulation.”

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