Stockholm (NordSIP) – American Century Investments (ACI) and Nomura Asset Management (NAM) have announced the launch of the American Century® Emerging Markets Sustainable Impact Equity Fund. Portfolio managers Patricia Ribeiro and Sherwin Soo are responsible for the fund’s investments.
“We believe an asset manager can offer both dedication to investment performance and an opportunity to make real change for good in emerging markets around the world,” Ribeiro said.
The new actively managed Dublin-based UCITS fund will invest in 70-75 companies, located primarily in emerging markets (EM) that demonstrate accelerating growth. ACI specifically mentions “South America, China, Thailand, South Korea, Taiwan, Indonesia, India and South Africa” as “emerging markets where the firms currently measure this impact”.
Investing in the UN SDGs
Beyond long-term growth, the fund will seek to make a positive social and environmental impact in emerging markets and provide excess returns above the MSCI Emerging Markets Index, while contributing to one or more of the UN Sustainable Development Goals (SDG). According to ACI, 15 of the 17 goals are investible along the firm’s investment process.
All UN Member States adopted the SDGs in 2015 as a universal call to action to end poverty, protect the planet and ensure that all people enjoy peace and prosperity by 2030. Impact investing using the SDG framework is especially crucial in emerging markets, according to ACI.
“These countries need greater investment in infrastructure, technological innovation and education than more developed markets,” ACI’s accompanying press release argues. “Living standards in EMs are among the lowest in the world and socioeconomic inequalities, including gender and income, can be significant. With some of the world’s most fragile ecosystems, emerging market countries are also more vulnerable to environmental damage as well as pandemics and rare regional diseases.”
An Experienced Team
Portfolio managers Ribeiro and Soo have worked together for more than eight years and are supported by a well-resourced team of five analysts, according to ACI. The investment team meets with more than 2,000 companies annually and was managing US$4 billion in emerging markets assets by the end of 2019. The new fund will follow the same investment philosophy and process followed by the emerging markets equity team in managing the American Century® Emerging Markets strategy but will add an ESG/SDG overlay.
“The Emerging Markets Sustainable Impact Equity Fund will be our second UCITs collaboration with our strategic partner ACI,” Peter Ball, Managing Director at NAM UK, commented. “Investors increasingly want their portfolios to provide financial security but also to address key global issues, both of which can be achieved through positive social and environmental impact without sacrificing investment returns.”
The American Century® Emerging Markets Sustainable Impact UCITS will be added as a sub-fund to the Nomura Funds Ireland plc platform, which had US$8.5 billion in AUM at the end of 2019.