Fidelity International has launched its Sustainable Family of Funds range which incorporates the firm’s newly launched proprietary sustainability ratings.
The cross-asset fund range consists of five products, including water and waste and carbon reduction sustainable thematic strategies, and three best-in-class equity and fixed income funds.
The best-in-class funds will actively select companies that are high ESG performers relative to peers, while the sustainable thematic funds will use an investment approach that helps to address sustainability challenges or create a positive value-add to society and the environment, the asset manager stated.
The funds include the Sustainable Water and Waste Fund, the Sustainable Global Equity fund, and Sustainable Eurozone Equity Fund, all of which have an estimated ongoing charge figure (OCF) of 1.10%. The range also comprises the Sustainable Reduced Carbon Bond Fund, with an estimated OCF of 0.70%, and the Sustainable Strategic Bond Fund, with an estimated OCF of 0.76%.
The funds’ investment approach is centred around engagement, exclusion, and Fidelity’s proprietary research. This combines the firm’s focus on active engagement with an enhanced exclusion framework to ensure companies in which the funds invest meet certain sustainable standards and behave in a manner consistent with responsible investment values.
Fidelity’s bottom-up research process, which uses the insights of more than 180 research analysts and specialist ESG team, includes the company’s proprietary sustainability ratings, which it launched in June.
The ratings framework segments the investment universe into 99 subsectors, with industry-specific criteria which result in each issuer being assessed against its peers and awarded a rating of A to E.
Jenn-Hui Tan, global head of stewardship and sustainable investing at Fidelity International, which has approximately £86.4bn of assets under management, said: “ESG has long been integrated throughout our investment process and the Sustainable Family marks the next step in our evolving approach to sustainable investing in order to meet the growing demands of our clients around the world.
“Our deep corporate access gives us the opportunity to form a forward-looking view of the factors impacting a company’s ESG performance. This was recently enhanced with the launch of our proprietary sustainability ratings, which will greatly enhance our portfolio managers’ decision-making process and help us to focus on delivering long-term sustainable outcomes for investors,” Tan added.
