Global investment manager Nuveen has launched the Global Core Impact Bond strategy, which will offer an actively managed, multi-currency global bond portfolio that invests across global fixed income markets.
The firm said the strategy followed the environmental, social and governance (ESG) investment process established in 2007 by Stephen Liberatore, Nuveen head of ESG/impact – global fixed income.
The Global Core Impact Bond strategy would direct capital to “best-in-class” ESG leading issuers and securities that provided direct and measurable environmental or social impact.
The strategy will be co-managed by Liberatore; Anupam Damani, head of international and emerging markets debt; and Jessica Zarzycki, co-portfolio manager for the existing ESG/impact fixed income accounts.
The team would seek investment opportunities across the broad bond market and may allocate up to 40% in emerging markets and 15% in high yield, at the managers’ discretion. It will launch with $25M of seed capital.
Liberatore said significant investment was needed to combat some of the key issues our society faced, including climate change, global inequality and chronic housing shortages across the world.
“Yet the perception – an inherently false one – is that impact objectives either require a performance sacrifice or can be pursued only through private strategies,” Liberatore said.
“We firmly believe public markets, and in particular the fixed income space given its size, can offer investors attractive risk adjusted returns, while ensuring they have a measurable societal and environmental impact.”
Andrew Kleinig, Nuveen head of Australia and managing director, said the global pandemic had brought to the fore the need to tackle social and environmental issues head on.
“In response, we are seeing increasing demand from our clients for investment solutions that offer both returns and tangible impact,” Kleinig said.
“We can make real progress in areas such as affordable housing and community development, by investing in a range of public fixed income sectors where proceeds can be tied to specific projects or initiatives or are used to fund entities fully engaged in such efforts. This appeals to clients globally, as they seek to align their investments to specific outcomes.”
The firm currently managed over $15 billion in ESG/impact fixed income strategies and had assets under management of $6.6 billion as of 31 March, 2021.