Columbia Threadneedle Investments has launched a “social bond” fund, said to be the first of its kind in Europe.
The Threadneedle (Lux) European Social Bond product is launched in partnership with Inco, a global consortium for a “new, inclusive and sustainable economy”, and invests in corporate bonds.
It follows on from the firm’s 2013 launch of the UK Social Bond fund in partnership with Big Issue Invest, and a US Social Bond fund in 2015.
Both a financial and a social return are aimed at through investment in corporate bonds across Europe with a “clear focus on supporting positive outcomes for individuals, communities or society as a whole”.
Simon Bond, director of responsible investment portfolio management, is the fund’s manager, and said: “We are seeing a growing demand from clients to deploy their savings in a way that can generate social benefits and sustainable positive outcomes.”
Investors need not sacrifice performance to achieve social impact, he added.
“By actively selecting specific bonds with positive social outcomes, rather than excluding bonds through conventional negative screens, we aim to generate positive social and financial results.”
Out of 4,000 European corporate bonds in the market, the firm’s credit analysts have identified that about 45% that are social in nature across different sectors and countries.
The portfolio covers areas such as affordable housing, health, education and employment, and offers daily liquidity.
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