Weekly ESG News: Financial Services and Insurance Industry (36/2024)
News in the spotlight: AllianzGI’s Impact Private Credit strategy reaches EUR560mn
Allianz Global Investors (AllianzGI) achieved €560 million in total commitments for its Impact Private Credit (IPC) strategy at the first closing.
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Regulations & Law
Australia passes landmark climate disclosure law for companies
The Australian Senate has passed a new law mandating climate-related reporting for large and medium-sized companies, aligning the country with international sustainability standards. The law, part of the Albanese government’s Sustainable Finance Roadmap, requires companies to disclose climate risks, opportunities, and greenhouse gas emissions. The first wave of companies affected includes those with over 500 employees or significant revenues or assets, with reporting starting in 2025. Treasurer Jim Chalmers highlighted that these reforms will provide clarity for investors and strengthen Australia’s appeal for global capital. The Australian Accounting Standards Board and Auditing and Assurance Board are preparing the necessary standards for implementation.
ESMA reports that transition funds outpace green investments
Investor interest in transition-focused funds, which support the shift from high-carbon to low-carbon activities, has nearly doubled inflows compared to traditional green funds over the past two years, according to a report by the European Securities and Markets Authority (ESMA). While overall ESG fund growth has stagnated, particularly in light of political pressures in the U.S., transition funds have gained traction, despite remaining smaller in size. These funds typically focus on sectors like fossil fuels and utilities, investing in firms considered environmental leaders within their industries. ESMA also highlighted the need for clear guidelines on transition funds, recommending a categorization system and an expanded EU Taxonomy to better define sustainable transition investments.
Products and Services
BNP Paribas Asset Management launches two ESG Active Beta Equity ETFs
BNP Paribas Asset Management launched two equity ETFs: BNP Paribas Easy Sustainable Japan UCITS ETF and BNP Paribas Easy Sustainable US UCITS ETF. These funds blend traditional indexing with BNP AM’s proprietary ESG methodology, aiming for sustainability-focused investments with minimal tracking error. Both ETFs are Article 8 funds under SFDR regulation, with the Japan ETF targeting a 55% sustainable investment and the US ETF 45%. The ETFs integrate decarbonization, ESG scoring, and sustainability label eligibility, offering flexibility to investors seeking responsible and adaptable investment options.
Robeco launches High Income Green Bond Strategy
Robeco has introduced its first High Income Green Bond strategy, marking a significant expansion into the credit market with a focus on sustainability. This strategy, classified under Article 9 of the Sustainable Finance Disclosure Regulation (SFDR), is designed to offer attractive income while financing environmental projects. Unlike traditional benchmarks, it targets high-yield green bonds issued by corporations, which fund initiatives aligned with global decarbonization goals. The strategy uses Robeco’s proprietary five-step green bond framework to ensure the environmental integrity of investments while supporting investors’ demand for impact-driven returns. This approach addresses the rising popularity of green bonds, which represented over 60% of ESG bond sales in 2023, offering a solution for investors seeking both financial returns and positive environmental impact.
AllianzGI’s Impact Private Credit strategy reaches EUR560mn
Allianz Global Investors (AllianzGI) achieved €560 million in total commitments for its Impact Private Credit (IPC) strategy at the first closing. This strategy aims to deliver both financial returns and measurable environmental and social impacts by investing in private credit for companies aligned with sustainable development. Major commitments came from Allianz, APG Asset Management, and other institutional investors. The IPC strategy is structured to support businesses focusing on decarbonization, social inclusion, and sustainable infrastructure, contributing to long-term societal progress alongside investor gains (source: allianzgi.com)
Mirova raises more than €200 million in commitments for its first private equity fund
Mirova has exceeded €200 million in commitments during the final closing of its first private equity fund dedicated to natural capital. The fund focuses on investing in businesses that prioritize biodiversity conservation and the sustainable management of natural resources. The achievement underscores Mirova’s leadership in sustainable finance, with investors drawn to the fund’s dual goals of delivering positive environmental impact and generating financial returns. The fund has received support from a wide range of institutional investors, highlighting the growing demand for impact-driven investment opportunities that contribute to environmental preservation.
SEB launches its SEB Global Sustainable Companies Fund
SEB has launched the SEB Global Sustainable Companies Fund, an Article 9 fund under the EU’s Sustainable Finance Disclosure Regulation (SFDR). The fund invests exclusively in companies committed to environmental and social sustainability, aligned with EU Taxonomy and the UN’s Sustainable Development Goals (SDGs). It offers lower carbon intensity—about 50% lower than the MSCI World Net Return Index—and broad diversification across 500 companies in 20 developed markets. SEB aims to provide investors with a cost-efficient, sustainable investment option while maintaining solid financial performance.
Nasdaq partners with Crux to unlock Inflation Reduction Act's Clean Energy Tax Credit Market
Nasdaq has teamed up with sustainable fintech company Crux to facilitate access to the Inflation Reduction Act’s clean energy transferable tax credits. This partnership will allow Nasdaq clients to leverage Crux’s platform to connect with clean energy developers and manufacturers, and to manage and acquire these tax credits. The Inflation Reduction Act, passed in 2022, made these credits transferable, creating a new avenue for funding energy transition projects. Crux’s platform, launched in 2023, is expected to see the transferable tax credit market grow significantly in 2024. Nasdaq clients will gain insights and access to this expanding market through the collaboration.
BNP Paribas AM secures $166m for Cleantech Venture Fund
BNP Paribas Asset Management (BNPP AM) has successfully raised €150 million (USD $166 million) for its BNP Paribas Solar Impulse Venture Fund (BNPP SIVF), targeting innovative cleantech startups to advance ecological transition. Launched in 2021 in partnership with Bertrand Picard’s Solar Impulse Foundation, the fund focuses on sectors such as energy transition, sustainable agriculture, circular economy, and smart cities. Initially backed by €75 million from BNP Paribas, the fund has attracted diverse investors, including institutions and family offices, and aims to make 15-20 investments. So far, it has invested in companies like NatureMetrics, Phenix, Axioma, Hello Watt, and Chemix. With a hard cap of €200 million, BNPP AM expects to finalize the fund by year-end.
ESG and Green Bond Issuances
RMB Namibia and Letshego Namibia partner for social bond issuance
RMB Namibia and Letshego Namibia have launched the country’s first social bond, raising N$ 450 million. This bond is aimed at promoting affordable housing and financial inclusion, particularly for lower-income Namibians. Listed on the Namibian Stock Exchange (NSX), the bond received bids totaling N$ 545 million, exceeding expectations. It marks a significant step in Namibia’s sustainable finance landscape, aligning with global standards for social impact investments, and is expected to benefit a broad segment of the population while contributing to the country’s development.
Leadership Announcements
Ossiam appoints Ksenya Rulik as Head of Research and ESG
Ossiam, a leading quantitative investment firm, has appointed Ksenya Rulik as Head of Research and ESG (Environmental, Social, and Governance). Rulik, who has an extensive background in quantitative analysis and portfolio management, rejoins Ossiam after previously serving the firm in similar roles. Her expertise spans systematic investment strategies, ESG integration, and advanced research methodologies. In her new position, Rulik will oversee the firm’s research efforts and further enhance its ESG offerings, aligning with Ossiam’s mission to deliver transparent and sustainable investment solutions. She also brings experience from Kepler Cheuvreux.
Net Zero Commitments
TotalEnergies Invests $100 Million in U.S. Forest Carbon Projects
TotalEnergies has committed $100 million to support forest-based carbon reduction projects in partnership with Anew Climate and Aurora Sustainable Lands. This investment will enhance Improved Forest Management practices across 20 projects in 10 U.S. states, covering 300,000 hectares. The initiative aims to preserve natural carbon sinks, improve water and soil quality, and protect biodiversity. TotalEnergies will acquire carbon credits from these projects to offset part of its Scope 1 & 2 emissions as it strives for carbon neutrality by 2050. The company plans to invest $100 million annually in projects generating at least 5 million metric tons of CO2e credits per year by 2030. Anew Climate and Aurora Sustainable Lands, which manage over 1.7 million acres of U.S. forestland, will use the funds to advance carbon stewardship and ecosystem preservation. TotalEnergies’ Vice President Adrien Henry and Anew Climate CEO Angela Schwarz emphasized the alignment of this investment with broader climate action strategies.
Microsoft and EDP Renewables Sign Landmark 20-Year Solar Deal in Singapore
Microsoft and EDP Renewables (EDPR) have entered a 20-year agreement where Microsoft will purchase all the renewable energy produced by EDPR’s SolarNova 8 project, the largest solar initiative in Singapore. The SolarNova program, launched in 2014, aims to deploy 2 GW of solar capacity by 2030, and EDPR’s Phase 8 project will add up to 200 MW across numerous public and government buildings. This new deal reinforces the ongoing partnership between Microsoft and EDPR, following a recent agreement in the U.S. under the “Environmental Justice PPA” framework. The collaboration supports Microsoft’s ambitious sustainability goals, including achieving 100% renewable energy for its global operations by 2025 and becoming carbon negative by 2030. EDPR’s CEO, Miguel Stilwell D’Andrade, emphasized that the agreement helps drive Singapore’s sustainability efforts and accelerates the energy transition in the region.