A green and sustainable bond fund open to wholesale and retail investors has been launched by Artesian Capital Management and in a short amount of time has beaten its benchmark in each of the five months since inception.
The Artesian Green & Sustainable Bond Fund (AUD) has been running since late September and reportedly attracted seed funding from Australian ethically-minded super fund, Future Super.
The fund aims to offer investors access to a diversified portfolio of green, sustainable and social bonds.
Performance is benchmarked to the Bloomberg AusBond Composite 0-5 Yr Index and to 31 January 2021 the fund has achieved a Net Fund Return of 2.37%.
“Artesian are a niche fixed income and venture capital fund manager with a strong focus on ESG and impact investing,” said Matthew Clunies-Ross, managing partner and chief investment officer.
“We have been actively trading green bonds from our New York and London offices for five years, so we were delighted when we saw issuance take off in the AUD market. In saying that, the AUD green and sustainable corporate bond market is still quite niche due to its size, so it made perfect sense for us to offer this type of fund to our investors.”
The company said the fund has proven to be popular since inception attracting institutional, wholesale and retail investors.
It said that the fund not only tackles climate change, but also aims to address the United Nations 17 Sustainable Development Goals (SDGs).
“Whilst the fund is still in its infancy, we are quite proud we have been able to address 13 of the 17 SDGs, such as sustainable cities and communities, clean water and sanitation and gender equality through some of the corporate bonds owned by the fund,” said David Gallagher, Portfolio Manager of the fund.
“We are achieving this whilst not compromising on investment returns for our investors. For example, Lendlease issued a 7yr green bond in late October and it is the best performing corporate bond in the entire AUD market over the same time period.”
Artesian believe that their investors are truly interested in the impact that their investment is making. So to account for that, they have designed a monthly report which goes into specific detail on impact projects and carbon abatement achieved through the fund’s investments.
“We believe that 2021 will be a record year for green, sustainable and social bond issuance in the AUD market. Interestingly, the first bond issued in Australia this year was a green bond by the European Investment Bank. So the early signs for 2021 issuance look quite positive,” Gallagher said.
Investors can apply direct online with Artesian Capital or contact their financial adviser or stockbroker.