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Green Bonds

Green Bonds

Investing in green bonds to create long-term positive environmental impact

Key points:

  • Targeted impact investing that benefits the environment
  • Proprietary green bonds framework to determine portfolio eligibility
  • Combines our capabilities in global fixed income and sustainable investing

Philosophy

The strategy aims to create positive environmental impact, whilst generating outperformance relative to its underlying benchmark, the Bloomberg Barclays MSCI Global Green Bond Index, over the long run.

The underlying investment philosophy is based on the segmentation of fixed income markets and how they are not perfectly synchronous. Fear and greed cycles overshoot, creating dislocations in valuation and risk premiums. We believe that we can discover and exploit these market inefficiencies.

Process

The strategy uses a proprietary five-step bond selection framework to determine the eligibility of green bonds and to ensure that these are in line with the most recent regulatory developments on sustainable finance. It is designed to ensure that only those green bonds that adhere to internationally accepted principles for green bonds, and which truly have an impact, are eligible for the portfolio.

Once the universe of eligible green bonds is determined, a fundamental analysis is applied, relying on the disciplined and repeatable investment process used by the Robeco Fixed Income team.

The Green bonds strategy is actively managed with a diversified exposure to the global green bond market. It exploits both active interest rate and credit strategies by investing in green bonds issued by governments, government-related agencies and corporates.

Greening the bond market
Greening the bond market

Green bond issuance has developed healthy momentum over recent years.

Read the insight

Team

The strategy is managed by a team of global fixed income and sustainability specialists that has experience in the green bond market since 2013.

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Disclaimer

BY CLICKING ON “I AGREE”, I DECLARE I AM A WHOLESALE CLIENT AS DEFINED IN THE CORPORATIONS ACT 2001.

What is a Wholesale Client?
A person or entity is a “wholesale client” if they satisfy the requirements of section 761G of the Corporations Act.
This commonly includes a person or entity:

  • who holds an Australian Financial Services License
  • who has or controls at least $10 million (and may include funds held by an associate or under a trust that the person manages)
  • that is a body regulated by APRA other than a trustee of:
    (i) a superannuation fund;
    (ii) an approved deposit fund;
    (iii) a pooled superannuation trust; or
    (iv) a public sector superannuation scheme.
    within the meaning of the Superannuation Industry (Supervision) Act 1993
  • that is a body registered under the Financial Corporations Act 1974.
  • that is a trustee of:
    (i) a superannuation fund; or
    (ii) an approved deposit fund; or
    (iii) a pooled superannuation trust; or
    (iv) a public sector superannuation scheme
    within the meaning of the Superannuation Industry (Supervision) Act 1993 and the fund, trust or scheme has net assets of at least $10 million.
  • that is a listed entity or a related body corporate of a listed entity
  • that is an exempt public authority
  • that is a body corporate, or an unincorporated body, that:
    (i) carries on a business of investment in financial products, interests in land or other investments; and
    (ii) for those purposes, invests funds received (directly or indirectly) following an offer or invitation to the public, within the meaning of section 82 of the Corporations Act 2001, the terms of which provided for the funds subscribed to be invested for those purposes.
  • that is a foreign entity which, if established or incorporated in Australia, would be covered by one of the preceding paragraphs.
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