Stockholm (NordSIP) – Global asset manager BlackRock announces the launch of a series of UCITS Emerging Market Debt funds that integrate ESG factors, which includes a bond fund, a local currency bond fund, a corporate bond fund and a blended bond fund.
The funds will be managed actively against a set of ESG benchmarks launched by J.P. Morgan in collaboration with BlackRock in April 2018. The four products will provide a varying degree of exposure to debt securities issued by government, public local authorities or corporates in emerging market countries.
For Sergio Trigo Paz, Head of the firm’s Emerging Market Debt team, which, as of the end of June, oversees over $27bn in assets globally, ESG investing in EM debt may benefit investors as well as ESG-friendly issuers: “It is our belief that industry leaders should develop scalable sustainable investing solutions for investors. We believe the recent launch of the ESG indexes in EM debt (…) could prompt greater capital allocation to more ESG-friendly issuers over time, and there is a real opportunity to seek out enhanced returns using insightful ESG analysis, big data and text mining, as well as boots-on-the-ground engagement with issuers,” he says in a press release.
“The gap between ESG leaders and laggards is large in the EM world, and a strong ESG data can provide forward-looking information that captures the underlying deterioration of an issuer’s creditworthiness, sometimes well before standard macro credit metrics. These funds harness our proprietary ESG scoring and other analytic tools to help build ESG-focused investment themes that take advantage of additional alpha-generating opportunities in the EMD space,” adds Giulia Pellegrini, Head of EMD Sustainable Investing and Portfolio Manager in BlackRock’s Emerging Market Debt team.
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