BlackRock has launched an actively managed ‘impact’ bond fund focused on emerging markets - BlackRock’s first product of this type and one of the first in the market, according to the firm.
The Emerging Markets Impact Bond Fund will try to deliver a measurable social and environmental impact, as well as positive returns, by investing at least 80% of its assets in green, social and sustainability bonds from sovereign and corporate issuers operating in emerging markets.
BlackRock said it had identified companies and countries on an “improving trajectory across multiple goals, including, crucially, poverty reduction, health, education, clean water and peace", and that the result is a portfolio of approximately 50-60 names offering daily liquidity.
Rich Kushel, head of BlackRock’s portfolio management group, said: “This is one of the first products with a clear focus on green, social and sustainable bonds for these economies, where capital is needed to drive sustainable growth. While emerging market bonds are already a strategic asset class for investors, there is a growing consensus that focused green and social funding can play an important role in closing the gap to the targets laid out in the UN Sustainable Development Goals.”
The investment team will analyse how issuers use the proceeds of capital raised, as well as how the issuers align with principles and guidelines from the International Capital Markets Association surrounding these kinds of bonds.
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