Stockholm (NordSIP) – As the demand for sustainable investment products remains strong despite the COVID-19 crisis, new players continue to enter this market. Yesterday, Evli was the latest player to join this rush, launching a new investment fund focusing on green corporate bonds.
The Evli Green Corporate Bond fund is Evli’s first fund to invest in the green corporate bond market. The fund is managed by Evli’s fixed income team, which has over twenty years of experience in the European fixed income market. The fund’s portfolio manager is Juhamatti Pukka, Evli’s director of fixed-income investments. Noora Lakkonen, a responsible investment analyst will monitor the responsibility factors of Evli’s corporate bond fund.
“The new fund responds not only to the growing demand from investors for a larger allocation of green bonds but also to the need to take action against unsustainable resource use and climate change,” says Pukka. “Green bonds offer credit risk in line with traditional bonds, but at the same time they support the transition to a more sustainable economy,” adds Lakkonen.
The fund invests in European investment grade and high yield corporate bonds. The fund’s investments must have an average credit rating of at least BBB-. Up to 20% of the fund’s assets can be invested in unrated loans.
“We believe that our approach to investing in the green bond market through corporate bonds offers several benefits to investors. Allocating to funds is more efficient with targeted products. In general, we believe that green bond issuers typically look more to the future. Succeeding in environmental and sustainability issues has a significant impact on long-term credit quality,” Pukka says.
Among its motivations, the fund seeks to assist in the achievement of the UN Sustainable Development Goals (UN SDGs) and the Paris Agreement, which it is estimated will require approximately US$6.9 trillion in infrastructure investment annually by 2030. “In addition, corporate investment is key to developing a greener economy. Therefore, it is important that the investment community directly supports the transformation of companies as they invest in projects that promote the transition to a low-carbon economy, as well as green and sustainable socially-funded social projects,” he concludes.