At the discretion of managers, the strategy can invest up to 40 percent in emerging markets and 15 percent in high-yield bonds and will be launched with an initial capital of $25 million. Investments focus on the impact of affordable housing, community and economic development, renewable energies and climate change, as well as natural resources.
To do so, the strategy enhances Nuveen’s proprietary general fixed income framework. This sometimes includes transparency in the use of income as well as annual disclosure of measurable results in order to ensure a positive impact.
The strategy is led by Stephen Liberator, Head of ESG/Impact – Global Fixed Income, Anupam Damani, Head of International and Emerging Markets Debt, and Jessica Zarzeki, Joint Portfolio Manager at Nuveen ESG/Impact Fixed Income Portfolios. The team is pursuing a proven ESG/impact investment process that Liberatore introduced in Nuveen in 2007 and is already in use in US core impact bonds and the short-term impact bond strategy.
Stephen Liberator comments: Significant investments are needed to tackle some of the major world problems facing our society, including climate change, inequality and chronic housing shortages. At the same time, there is a perception that the goals of influence can be achieved either at the expense of performance or can be pursued only through special strategies – a fallacy.
We strongly believe that the size of public markets, particularly the fixed income sector, can offer investors attractive risk-adjusted returns while exerting a measurable societal and environmental impact.”
Romina Smith, General Manager, Head of Central Europe, Global Client Relations, Erganzt: The global pandemic has made it clear how important it is to tackle social and environmental issues head-on. In response, we see an increase in demand from our clients for investment solutions that have a noticeable return and impact. We can make real progress in areas such as affordable housing and community development by investing in a range of public fixed income sectors, where funds can be tied to specific projects or initiatives, or used to fund businesses that develop fully committed to these purposes. This convinces clients around the world who want to focus their investment on specific outcomes.”
The strategy is available to investors based in Australia, Denmark, the Netherlands, Switzerland, Germany, Great Britain and Italy.
With over 50 years of experience in responsible investing and over 30 years of experience in impact investing, Nuveen can look back at a long history of success in using capital for the benefit of people and the planet. The first investment in impact investing dates back to the 1980s. Today, Nuveen manages more than $15 billion in this area in ESG/fixed income strategies, and is also one of the largest investors in green bonds and their impact with $6.6 billion (as of March 31, 2021).