BNP Paribas Asset Management (BNPP AM) has launched a strategy investing in companies that are facing or tackling significant environmental challenges.
The challenges include issues connected with global population growth, such as increased waste production and emissions, as well as higher demand for water, food, and energy, the firm said.
The Environmental Absolute Return Thematic Fund combines long positions in the most promising companies within the energy, materials, agriculture and industrials markets that are providing solutions to these issues, with short positions in unsustainable or technologically inferior businesses.
Edward Lees, joint manager of the fund, said: “As population growth boosts demand for food, water and energy, causing increasing CO₂ emissions, waste production and unsustainable consumption, the market for solutions to meet these needs could amount to trillions of dollars and will be increasingly encouraged by governments.”
Holdings in the strategy are selected on a thematic, relative value or catalyst-driven basis, whilst fully integrating ESG principles.
The investment universe consists of global developed and emerging market companies typically capitalised at more than $1 billion (€0.8 billion), each of which is mapped to one or more of eight environment-related Sustainable Development Goals (SDGs).
The SDGs were set up by the UN to provide a blueprint to work towards a more sustainable future.
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