Nuveen Expands Impact Investment Suite with Launch of Global Bond Fund
Nuveen, the $1.2 trillion AUM investment manager of TIAA, announced today the launch of the Global Core Impact Bond fund, a global, multicurrency fixed income fund, aiming to direct capital to best-in-class ESG leading issuers and securities that provide direct and measurable environmental or social impact.
According to Nuveen, the new UCITS-compliant fund will direct capital to several specific impact themes, including affordable housing; community and economic development; renewable energy and climate change; and natural resources. The fund will launch with $25 million of seed capital, and may allocate up to 40% in emerging markets and 15% in high yield, at the managers’ discretion.
The new fund adds to Nuveen’s suite of impact bond funds, including the (US) Core Impact Bond Fund and Short Duration Impact Bond Fund. The funds follow Nuveen’s proprietary public fixed income impact framework, including transparent use of proceeds and annual disclosure of measurable outcomes, to ensure positive impact.
The launch also follows Nuveen’s announcement in April that it had raised $575 million for the industry’s first impact investing-focused closed-end fund, Nuveen Core Plus Impact Fund.
Alex Prout, Head of Global Client Relationships, said:
“The global pandemic has brought to the fore the need to tackle social and environmental issues head on. In response, we are seeing increasing demand from our clients for investment solutions that offer both returns and tangible 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 proceeds can be tied to specific projects or initiatives or are used to fund entities fully engaged in such efforts. This appeals to clients globally, as they seek to align their investments to specific outcomes.”
The fund will be co-managed by Stephen Liberatore, Head of ESG/Impact – Global Fixed Income, Anupam Damani, Head of International and Emerging Markets Debt, and Jessica Zarzycki, co-portfolio manager for the existing ESG/impact fixed income accounts.
Liberatore said:
“Significant investment is needed to combat some of the key issues our society faces, including climate change, global inequality and chronic housing shortages across the world. Yet the perception – an inherently false one – is that impact objectives either require a performance sacrifice or can be pursued only through private strategies.
“We firmly believe public markets, and in particular the fixed income space given its size, can offer investors attractive risk adjusted returns, while ensuring they have a measurable societal and environmental impact.”