Columbia Threadneedle Investments, has today launched the CT Global Social Bond Fund available to UK investors.
The Fund, managed by a dedicated Social Bond team led by fixed income senior portfolio manager Tammie Tang, aims to use the size of the bond market to target social outcomes in a growing global universe. The launch supports the intention to spread the benefits of Columbia Threadneedle’s pioneering social impact investment globally.
The CT Global Social Bond Fund is the latest addition to Columbia Threadneedle’s innovative social impact range, which includes Social Bond strategies focused on the UK and Europe. Columbia Threadneedle has a long history of taking the lead in relation to impact investing, launching the first mainstream fixed income impact investment offering in the UK in 2014, despite the existence of very few social impact labelled bonds being available in the market. Since 2013, there has been considerable growth in social, green and sustainable issuances. In 2017, when the European Social Bond strategy was launched, the market was valued at $200 billion. Columbia Threadneedle recognised the bond market’s role in social investing early on and contributed to its growth. The new CT Global Social Bond Fund has been designed to take advantage of a developing global universe in specific use of proceeds labelled bonds that has grown to $3.5 trillion.
The Fund uses Columbia Threadneedle’s existing unique and proprietary methodology to determine the suitability of bonds based on their social impact by giving each a social rating based on their focus on deprivation and clarity of impact reporting. Using an outcomes-based approach to deliver both social and financial returns, bond issuers that make a positive social impact in seven key social development fields[1] are identified to form a global-based social universe of over 6000 bonds. Outcomes are mapped to the underlying 169 targets of the 17 UN Sustainable Development Goals.
The Fund’s management team will continue to be proactive with corporates and governments in the fast-moving growth of the social bond market with over 40 responsible investment analysts actively engaging company management teams on material ESG issues.
Further counsel is provided by the Fund’s Social Advisory Panel, which consists of representatives from Columbia Threadneedle and members from the Fund’s social partner organisation ‘The Good Economy’ and from impact adviser Steward Redqueen. The Panel will constantly review, assess and monitor the Fund’s social impact, ensuring the social intensity of the Fund’s investments, as well as set the Fund’s social targets. In line with the other Social Bond strategies, an annual impact report will be published for the Fund. This counsel, in addition to Columbia Threadneedle’s robust methodology and heritage in social investing ensures targeted social impact alongside financial returns.
Tammie Tang, Portfolio Manager of the CT Global Social Bond Fund said: “The launch of the CT Global Social Bond fund is an important step in Columbia Threadneedle’s ongoing commitment to, and belief in, the power of impact investing. As pioneers in this area, we are confident in the potency of bond investing to tackle globally systemic problems without sacrificing financial returns in line with the benchmark. 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.”
Michaela Collet Jackson, Head of Distribution, EMEA, at Columbia Threadneedle Investments, said: “Following increased client demand for both our UK and European social bond strategies, working with clients we believe the time is right to expand our range to include a Global strategy. We are excited to offer clients this new offering, which provides access to our tried and tested model of achieving financial returns and positive social impact, now using the global universe of socially labelled bonds. Initially available as an OEIC for UK investors, we intend to provide a version of the strategy available to European investors in the near future.”
[1] The seven key social development fields are: primary social needs, basic social needs, social enabling, social empowerment, social enhancement, social facilitation and societal developments
