Macquarie Bank’s proposed fund gets the green light

Anthony Abraham

Australian investors are set to take a more integral role in climate change following the signing of a memorandum between Macquarie Bank’s investment banking group and ratings and research group RepuTex, which in partnership aims to develop Australia’s first carbon integrated listed equities fund.

The proposed fund, which is expected to be developed by late October this year, will use RepuTex’s research to pinpoint stocks that are perceived to be best able to adapt and compete in a carbon-constrained environment.

The top stocks will be selected for inclusion in RepuTex’s Climate Change Growth Index, which currently consists of 47 Australian companies, and will be licensed by Macquarie Bank.

RepuTex claims that a portfolio of these companies, weighted according to its methodology, would have outperformed the S&P/ASX 300 Index by 14.04 per cent over the last three years ending August 31, 2007, and 6.86 per cent year to date.

This is good news for people investing in Australian companies, which are increasingly being slugged for carbon emissions overseas.

Macquarie executive director Anthony Abraham agreed that the establishment of a carbon integrated listed equities fund is well timed to succeed, considering climate change is just as much an environmental issue as it is a significant investment opportunity.

“RepuTex’s analysis shows that climate change and the carbon agenda have had an impact on company earnings globally and that this is likely to become more significant in Australia as the proposed Emissions Trading Scheme is phased in,” Abraham said.

RepuTex head of research Hugh Grossman urged investors to take notice of the proposed fund.

“With climate change fast becoming a significant investment issue in Australia, the proposed fund would offer investors, for the first time, access to a product which integrates more accurate assessments of company value and growth potential within a new carbon constrained economy,” Grossman said.