Fidelity International has launched a first-of-its-kind blue transition bond fund to help improve ocean and freshwater health.
The Fidelity Funds 2 - Blue Transition Bond fund will be managed by Kris Atkinson and Shamil Gohil, and will invest 80% of its assets in bonds issued by sustainable and environmentally conscious businesses globally.
Atkinson said: “We are particularly focused on blue bonds, a sub-component of the green bond market, which finance ocean and freshwater-related projects. However, blue bonds alone are not sufficient for investors looking to support ocean and freshwater themes while aiming to generate attractive risk-adjusted returns.
“A broader, more holistic approach needs to start at the issuer level; investors should consider how a company operates, which products and services it offers, and how these align to the blue transition.”
Oceans and freshwater play a vital role in supporting diverse ecosystems, as well as providing food and livelihoods, yet ‘life below water’ is the least-funded of the United Nations’ Sustainable Development Goals, according to Fidelity.
Another sustainability-focussed global corporate bond strategy was launched today by Nuveen. Its new Global Credit impact strategy has already secured $170m from investors including Gjensidige Pensjonsforsikring, a subsidy of one of Norway’s largest insurance companies, and Nuveen’s parent company, TIAA.
Portfolio manager Jessica Zarzycki, who co-manages the strategy with head of fixed income Stephen Liberatore, said it will “aim to lower the cost of capital for environmental and social projects by funding initiatives through the easily accessible, liquid public fixed income markets”.