Dutch asset management giant Robeco is launching an innovative factor-based quantitative credit and fixed-income strategy focused on the United Nations Sustainable Development Goals (SDGs) and climate sustainability.
RobecoSAM QI Global SDG & Climate Multi-Factor Credits, the group’s first SDG and climate-focused quant fixed-income strategy, is classified as Article 9 under the EU’s Sustainable Finance Disclosure Regulation (SFDR) and its launch coincides with the company’s 10-year anniversary of factor-based investing in credit.
“While the strategy’s performance is driven by Robeco’s proven multi-factor credit selection model, which has been applied to client portfolios since 2012, it has sustainability as its primary objective,” the firm said in a statement.
Committing to carbon footprint reduction, the strategy is measured against the Solactive Paris-Aligned Global Corporate Index. The portfolio’s average carbon emissions are kept below the Paris-aligned credit benchmark. This has 50% lower carbon emissions than the mainstream credit benchmark and decarbonises by 7% each year.
Additionally, Robeco says the new investment strategy invests in companies that have a measurable positive contribution to the UN SDGs, applying the Rotterdam-headquartered firm’s proprietary SDG framework.
“Thanks to its systematic investment process, the strategy also incorporates other sustainability dimensions like reducing ESG risk, water use and waste generation, and excluding companies that do not meet the required standard of sustainability,” said Robeco.
“In addition to its sustainable investment objective, the strategy simultaneously pursues the provision of long-term capital growth. RobecoSAM QI Global SDG & Climate Multi-Factor Credits aims to outperform the Solactive Paris-Aligned Global Corporate Index by 50 basis points over a full economic cycle.
The new strategy is managed by Robeco’s quant fixed-income income team, co-headed by Patrick Houweling, a seasoned quant professional with a long-standing track record in academia and the successful management of Robeco’s quantitative credit strategies.
Founded in 1929 and now a subsidiary of ORIX Corporation Europe, Robeco has been a global leader in sustainable investing since 1995 across a broad range of asset classes. As at the start of this year the group had EUR201 billion in assets under management, of which it says that EUR195 billion is committed to ESG integration.
Said Houweling: “I’m excited to be managing the RobecoSAM QI Global SDG & Climate Multi-Factor Credits strategy together with the team and allowing our clients to contribute to a range of climate and other sustainability goals while also benefiting from our 10 years of experience with multi-factor investing.”
