Stockholm (NordSIP) – Guided by the United Nation’s Sustainable Development Goals (SDGs), asset managers seem increasingly eager to tackle a broader range of sustainability issues these days. A case in point, Aviva Investors added two new funds to their Sustainable Transition range earlier this week, taking on the major challenges of social inequality and biodiversity loss, respectively.
“Aviva Investors is committed to the United Nation’s SDGs and to innovating sustainable, investable outcomes to achieve them,” comments Mark Versey, Chief Executive Officer of Aviva Investors, in a press release. He argues that social issues and biodiversity are essential drivers of the transition to a fair and sustainable economy and that they shouldn’t be forgotten while tackling the overarching climate change challenge.
The Aviva Investors Social Transition Global Equity Fund will endeavour to advance three SDGs in particular, 5, 8 and 10. The fund builds on the social transformation framework created by the World Benchmarking Alliance (WBA), an initiative that Aviva helped create in 2018 to assess companies’ social performance.
The portfolio managers, Richard Saldanha and Matt Kirby, aided by Senior Impact Analyst Vaidehee Sachdev, will select companies changing their business models to respect human rights, promote decent working conditions and engage in responsible corporate behaviour. The fund will also invest in companies that provide solutions towards improved access to education and health and broader financial inclusion. Businesses in breach of established social principles, or those involved in severe social controversies, will be excluded. According to the press release, the fund will also donate 5bps of its management fee to social impact projects.
Aviva recently published a comprehensive biodiversity policy, which includes a commitment to use best efforts via engagement and stewardship to eliminate forest-risk agricultural commodity-driven deforestation activities at the companies in the Group’s investment portfolio and financing activities by 2025. The second one of the new launches, the Aviva Investors Natural Capital Transition Global Equity Fund, is directly aligned with that policy as well as with SDGs 12, 13, 14 and 15.
The fund will invest in companies that provide solutions and are transitioning their business models across the themes of sustainable land, sustainable oceans, the circular economy, and climate change. Meanwhile, it will exclude firms involved in certain harmful activities or severe environmental controversies. An experienced and knowledgeable trio will manage the fund, portfolio managers Julie Zhuang and Jonathan Toub and Senior Impact Analyst Eugenie Mathieu.
The launch of the two new funds is both necessary and timely, argues Aviva Investors CEO. “Twenty-one per cent of the global population lives in extreme or moderate poverty, and only twenty-seven per cent of global managerial positions are occupied by women,” he says. “Furthermore, fourteen of the eighteen ecosystem services on which society depends have been degraded or are in decline. This is alarming because over half of global GDP is dependent on high functioning biodiversity and ecosystems. The time to act is now,” concludes Versey.
