In launching the sub-fund, NN IP stated that it is responding to the steady and irreversible movement towards environment, social and governance (ESG) and responsible investing.
The fund currently has around €100m (£84m, $106m) in assets under management and is targeted at the ‘balanced investor’ who wants to invest responsibly without financial compromise.
The actively managed sustainable multi-asset strategy invests in a diversified portfolio of European equity and euro-denominated fixed income instruments.
Exclusionary approach
To determine the eligible sustainable investment universe of the fund, NN IP adopts an exclusionary approach.
Depending on the asset class, a specific inclusion approach is used to select the best ideas, using both ESG and financial criteria.
Furthermore, the strategy is managed based on a balanced risk profile: 50% equity and 50% bonds, with a bandwidth of +10%. The benchmark of the fund is 50% MSCI Europe (net) + 50% Barclays Euro Aggregate.
Mainstream indices are used in the composite benchmark to underpin NN IP’s belief that implementing ESG criteria can enhance performance.
Siu Kee Chan, senior portfolio manager, multi-asset at NN IP, said: “Avoiding controversial names and companies that show improving ESG scores are proven to show better investment returns.
“Therefore, we believe that integrating ESG criteria in this fund offers an additional source of return.”
