Green bonds made available in Luxembourg Sicav

windfarm 410State Street Global Advisors (SSGA) has given environmentally friendly investors a fixed income product they can add to their portfolio.

The Global Green Bond Index Fund is a Ucits fund that tracks Barclays MSCI Green Bond Index. It will be offered via a Luxembourg Sicav and is available to investors across Europe.

A green bond is essentially the same as a traditional bond but its proceeds are exclusively applied to projects or activities that promote environmental sustainability. This may include the development of alternative or renewable energy projects, pollution prevention and control, sustainable water and ‘green’ buildings.

Niall O’Leary, head of portfolio strategy, Europe, Middle East and Africa at SSGA, says that this new initiative brings the number of environmental, social and governance fixed income products offered by the firm to four.

“Green bond investing has seen substantial growth in the last 12 months, with in excess of $36 billion (€32.3 billion) of green bonds issued in 2014 as investors continue to demand sustainable investment strategies and diversification within their fixed income allocations,” he says.

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