Robeco Launches High Income Green Bond Strategy

International asset manager Robeco announced the launch of the High Income Green Bonds strategy, investing in high yielding green bonds by corporate issuers globally.

According to Robeco, the new strategy, categorized as Article 9 under the EU SFDR regulation, was launched in response to growing investor interest in the broad variety of green bonds, fixed income instruments issued by corporates and governments with proceeds earmarked for environmentalEnvironmental criteria consider how a company performs as a steward of nature. projects, including supporting transitioning companies in their decarbonization efforts.

Green bond issuance volume exceeded $560 billion in 2023, according to Moody’s, growing over the prior year as issuers from across sectors used the instruments to finance climate transition plans, and invest in capital intensive projects to meet decarbonization commitments, and amidst growing policy support improving the cost competitiveness of climate technologies such as green hydrogen, biofuels, battery storage and carbon capture, utilization and storage (CCUS).

Joop Kohler, Head of Credits for Robeco, said:

“With the growing interest in transition investing, our High Income Green Bonds strategy meets the dual objective of sourcing attractive income for our clients, whilst providing a core tool for investors to achieve their impact goals.”

The new strategy will be managed with a benchmark-agnostic, global approach across all credit sectors within green bond investments, with all corporate bonds required to pass the steps outlined in Robeco’s five-step green bond framework to be eligible for investment. Criteria assessed under Robeco’s framework include the alignment of issuers’ green bond framework with green bond market standards, the allocation of proceeds to make a positive contribution to the environmentalEnvironmental criteria consider how a company performs as a steward of nature. objectives defined by the EU Taxonomy, at least annual impact reporting on the use of proceeds by the issuer, the environmentalEnvironmental criteria consider how a company performs as a steward of nature. strategy of the issuer, and adherence to international norms related to socialSocial criteria examine how it manages relationships with employees, suppliers, customers, and the communities where it operates. and governanceGovernance deals with a company’s leadership, executive pay, audits, internal controls, and shareholder rights. issues.

Kohler added:

“Robeco’s High Income Green Bonds strategy is our first strategy focusing purely on green bonds from corporate issuers. It successfully combines the depth of our sustainability expertise with the long-standing track record and capabilities of our credit team.”