Europe’s largest asset manager has launched a $500m (€453m) climate bond fund in partnership with the Asian Infrastructure Investment Bank (AIIB).
The organisations are aiming to raise an additional $500m from other institutional investors for the Asia Climate Bond Portfolio before starting to deploy capital from January 2020, according to a press release published today.
Amundi and AIIB have developed an analysis framework for securities aimed at assessing “issuers’ ability to cope with climate change”, taking into account each company’s “green business”, climate mitigation efforts and resilience to the effects of climate change.
Using this framework, Amundi’s global emerging market debt team will allocate to “labelled green bonds and unlabelled climate bonds” and engage with issuers to improve their resilience to climate change.
The investors also said they wanted to engage with companies to “support the emergence of climate champions” in sectors such as infrastructure.
Lord Nicholas Stern – an economist and professor at the London School of Economics who also sits on AIIB’s advisory board – said the fund would “help support the emergence of green leaders in Asia” and mobilise “very large amounts of money for climate action and the energy transition in critical regions of the world”.
He added: “We should expect strong performance – more responsible investment and more modern techniques offer better returns.”
DJ Pandian, the AIIB’s chief investment officer, said: “We expect this investment will demonstrate how international financial institutions can approach development finance differently to support the Paris Agreement and adoption of climate finance principles.”
The investors said a portion of investment proceeds would be allocated to “market education, engagement and issuer support”.
AXA IM launches impact fund
AXA Investment Managers plans to launch an impact investing fund targeting companies serving consumers in Latin America, Asia and southern Africa.
The French investment house is aiming to raise $300-$400m to allocate to private companies operating in sectors such as healthcare and finance.
In a statement announcing the launch, AXA IM specifically highlighted companies seeking to improve access to drugs and vaccines, and those seeking to improve financial coverage to new groups of people.
Earlier this year, the asset manager launched an impact fund focused on climate and biodiversity, raising $175m. AXA IM’s impact investing team runs $600m in total.
NN IP green bond fund hits €1bn
Dutch asset manager NN Investment Partners’ (NN IP) green bond fund has reached €1bn in assets under management in three years since its launch in 2016.
NN IP claimed the fund was in a position to save 547,505 tonnes of carbon dioxide annually, based on the impact of its investments in environmental assets.
In addition, NN IP reported that the funded had outperformed its benchmark – the Bloomberg Barclays MSCI Euro Green Bond index – by 63 basis points a year since launch, before deducting fees.
Bram Bos, lead portfolio manager for green bonds at NN IP, said the fund’s focus on “dark green” assets meant investors were able to reduce their carbon footprints and protect against climate risk “without sacrificing liquidity and returns”.
“Dark green” bonds, according to NN IP, are linked to projects making a “measurable positive contribution” to the UN’s Sustainable Development Goals, with a focus on “climate change mitigation and climate change adaptation.
“In addition, we observe that these bonds offer better governance and greater transparency due to a higher level of engagement with issuers and stricter reporting requirements,” Bos added
The global green bond market was worth €440bn at the end of June 2019, according to NN IP.