Morgan Stanley Investment Management (MSIM) has launched Morgan Stanley Global Balanced Sustainable Fund, seeking to generate a measurable, positive environmental and social impact, alongside a financial return.
The fund combines the benefits of the team’s risk-controlled asset allocation process with a multi-dimensional framework for sustainable investing.
Managed by the Firm’s Global Balanced Risk Control (GBaR) team, the fund’s equity exposures will be tilted towards holdings that support the transition to a net-zero carbon economy, in line with the Paris-aligned target.
Led by Andrew Harmstone, head of the Global Balanced Risk Control strategy, the fund will allocate to global equity and fixed income securities, including impact equities and green bonds, as well as money market instruments and cash. The fund aims to offer investors the same attractive returns, and measure of downside protection in volatile markets, that have been the hallmark of the GBaR team over more than a decade of running risk-controlled portfolios.
“Our approach is highly flexible and, when we anticipate volatility, we are able to adjust exposure of the portfolio to a range of asset classes. The Global Balanced Sustainable Fund brings exciting opportunities to deliver attractive risk-adjusted returns across a market cycle, whilst at the same time bringing tangible environmental and social benefits,” says Harmstone.
As part of its ESG mandate, the portfolio team will also engage with selected companies through dialogue and proxy voting, to enhance the impact made by portfolio companies. It is expected that 5 per cent to 30 per cent of assets will be invested with managers who explicitly aim for positive environmental and social outcomes.
“Although sustainable investing has grown rapidly, there remain few options for investors who need a multi-asset solution in the public markets space. The Global Balanced Sustainable Fund combines thoughtfulness of approach to multi-asset ESG integration, with the credibility of the Paris-aligned target – a goal that is ever more top of mind in an era of climate change,” says Emily Chew, global head of Sustainability for Morgan Stanley Investment Management.
Richard Lockwood, head of Distribution for Northern Europe, adds: “Continuing to incorporate sustainable investing principles is a key priority for us. The launch of the Global Balanced Sustainable Fund is the latest development in our efforts to offer investors as much choice as possible in how they meet their sustainable investing goals.”
Morgan Stanley Investment Management has been at the forefront of sustainable investing as the business seeks to deliver clients sustainable products and solutions which offer long-term value. In 2019 alone, Morgan Stanley Investment Management engaged with more than 600 companies on sustainability issues, including climate risk, diversity, inclusion, and plastic waste reduction.
