New Fund Targets Global SDG Impact

    Stockholm (NordSIP) – BMO Global Asset Management announced on Monday, March 4, the launch of the BMO SDG Engagement Global Equity Fund, focusing on the UN’s 17 Sustainable Development Goals (SDGs).

    The new fund, seeded by UBS Global Wealth Management, through its 100% sustainable investing initiative, will hold between 40 to 60 carefully selected global small- and mid-cap equities focusing on furthering the SDGs through a tailored programme of engagement. The goal is to achieve long-term capital growth while delivering a positive impact on the world. Jamie Jenkins and the London-based global equities team, who also run BMO’s flagship Responsible Global Equity Strategy, will be running the strategy.

    “In our view, responsibly engaging with public companies and changing their behaviour for the better is one of the most exciting new areas of impact investing. It also forms a core part of our 100% sustainable cross-asset portfolio for private clients. By improving their social and environmental performance, firms can mitigate risks, support their brands, and take advantage of sustainable business opportunities. For investors, successful engagement should be a win-win result,” says Mark Haefele, Chief Investment Officer at UBS Global Wealth Management

    The fund’s Invest-Engage-Improve approach to investments is informed by the Sustainable Development Goals and underlies its pursuit of positive impact. Quality is at the core of the investment step, according to the funds’ brochure. “Alongside factors like ‘competitive advantage’ we look for companies that effectively manage environmental, social and governance (ESG) issues – factors integral to assessing risk and reward potential. Companies should be run by proven management teams, responsible in how they do business, appropriately incentivised and open to shareholder engagement,” the document states.

    The engagement step is informed by and matched to the SDGs. For example, the fund’s Dali Food Group holdings are motivated by achieving zero hunger (SDG2), responsible consumption and production (SDG12) and supporting aquatic fauna (SDG14). Similarly, investments in the Kerry Group are motivated by concerns with life on land (SGD15) and clean water and sanitation (SDG6). “We believe that the best way to achieve our engagement goals is by constructive dialogue with key decision makers on the most relevant ESG issues to each company, in order to drive improvement. Close collaboration between the Global Equities and Responsible Investment teams is at the heart of successful engagement,” explains the brochure.

    Finally, improvement is about measuring the impact of the fund. “For each company in the portfolio we monitor and measure the impact of our dialogue around defined SDG targets. We want to see improvement and continually assess the progress each company is making,” says BMO GAM.

    Picture by NordSIP

    Filipe Albuquerque
    Filipe Albuquerque
    Filipe is an economist with 8 years of experience in macroeconomic and financial analysis for the Economist Intelligence Unit, the UN World Institute for Development Economic Research, the Stockholm School of Economics and the School of Oriental and African Studies. Filipe holds a MSc in European Political Economy from the LSE and a MSc in Economics from the University of London, where he currently is a PhD candidate.

    Latest Posts

    NordSIP Insights Handbook

    What else is new?