Dutch asset management powerhouse Robeco is making waves in the sustainable investment sector by launching an innovative fund range to capture the growing potential of companies transitioning to greener practices.
This strategic initiative encompasses two new equity strategies and the repositioning of two existing fixed-income funds, all tailored to harness the untapped potential of sustainable transitions, particularly in emerging markets and Asia.
By focusing on businesses at the cusp of their sustainability journey, Robeco is positioning itself at the forefront of a transformative shift in global finance. The newly introduced equity strategies, Robeco Emerging Markets Climate Transition Equities and Robeco Transition Asian Equities, are at the forefront of this initiative. The former, managed by veteran fund managers Jaap van der Hart and Rob Schellekens, aims to align with the Paris Agreement goals by focusing on the shift towards a low-carbon economy in emerging markets.
The latter, helmed by Joshua Crabb, Robeco’s Hong Kong-based head of Asia-Pacific equities, takes a broader approach by addressing climate transition and other environmental and social objectives in the Asian market. Complementing these new offerings, Robeco has strategically repositioned two of its fixed-income funds.
The Sustainable Emerging Credits fund has been transformed into the Transition Emerging Credits strategy, while the Sustainable Asian Bonds fund has evolved into the Transition Asian Bonds fund. These adjustments reflect Robeco’s commitment to aligning its portfolio with its ambitious sustainability goals.
Why the sustainable transition by Robeco?
The rationale behind this strategic shift is compelling. Robeco recognises that investing in green technologies and renewable energy currently comprises less than 8% of the global economy, presenting a significant growth opportunity. By focusing on Asia and emerging markets, where the firm anticipates the most substantial changes, Robeco aims to be at the forefront of this economic transformation.
Lucian Peppelenbos, Robeco’s climate and biodiversity strategist, emphasised the significance of this move: “We acknowledge the importance and opportunities of transition finance. Our expertise in equities and credits, deep understanding of emerging markets, and sustainability background are key ingredients to driving successful transition investments.”
Robeco’s approach to transition investing is particularly noteworthy. Rather than solely focusing on already-green companies, the firm is targeting high-carbon-intensive businesses at the beginning of their sustainability journey. This strategy aims to support the comprehensive greening of the economy, foster positive change, and ensure that high-emitting companies become part of the solution.
To identify and invest in transition leaders, Robeco employs sophisticated frameworks that assess the credibility of companies’ transition pathways. Historical data suggests that these transition leaders have outperformed their peers in both developed and emerging markets, potentially offering alpha opportunities for investors.
Launching this fund range is a response to growing investor demand for sustainable options and strategic positioning for the future of finance. As the global economy increasingly shifts towards sustainable practices, Robeco’s initiative places it at the forefront of this transformation.
This move by Robeco represents a significant step in the evolution of sustainable investing. Robeco is expanding the scope of impact investing by focusing on companies in transition rather than those already operating sustainably. This approach promises potential financial returns and contributes to the broader global sustainability goal.
Don’t miss Robeco’s Corporate Sustainability Officer, Jeroen Nijhoff, speaking at the upcoming Sustainability Expo Europe. Taking place on October 1-2, this 2-day event will bring together over 500 senior sustainability professionals, sharing insights into the essential actions businesses must take to achieve sustainability. Register your place now!
