State Street Global Advisors (SSGA) has launched a climate bond fund range designed to facilitate the reduction of exposure to carbon emissions and fossil fuels in investors' portfolios.
The sustainable fund range will also reallocate capital to fund the transition to a low carbon future, the firm said on Monday.
Benchmarked against Bloomberg Barclays indices, the State Street Sustainable Climate Bond Funds leverage ESG data to reduce carbon intensity while also excluding “controversial” issuers.
The funds then materially scale up green labelled bonds to ensure capital is allocated to companies that are funding the overall transition to a low carbon economy.
Alistair Byrne, head of UK institutional distribution at SSGA, said: “Only by building sustainable and resilient investment portfolios at scale, in a way that works across asset classes and for a range of investors, will markets achieve the systemic shift in investment flows required to deliver on the goals of the Paris Agreement.”
Varma Mutual Pension Insurance Company, an earnings-related pension insurance company in Finland, are investing a total of $275 million (€226.9 million) in the new funds, SSGA also said in a statement.
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