Investment management firm Fidelity International announced today the launch of Fidelity Funds 2 – Blue Transition Bond Fund, a new fund aimed at supporting the transition towards improved ocean and freshwater health while achieving capital growth over the long term.
The launch marks the first blue transition fixed income fund globally, according to Fidelity, and comes as ocean and freshwater-related UN Sustainable Development Goals (SDGs), such as “Life Below Water” “Clean Water” and Sanitation” are among the least funded.
The new fund also forms part of Fidelity’s commitment to developing thematic fixed income investment solutions that address climate change, biodiversity, water, socialSocial criteria examine how it manages relationships with employees, suppliers, customers, and the communities where it operates. issues, and the broader SGDs, according to the firm.
According to Macquarie, the new fund will focus on supporting the transition towards improved ocean and freshwater health, and will invest in bonds of issuers that contribute to ocean and freshwater objectives aligned with one or more SDGs, use bond proceeds to finance projects benefiting ocean and freshwater related sustainability, including blue bonds, aim to improve management of water-related risks and opportunities, and reduce the negative impact of climate change on the ocean or freshwater.
The new fund will be managed by Fixed Income Portfolio Managers Kris Atkinson and Shamil Gohil.
Atkinson said:
“The bond market is uniquely positioned to help support the blue transition, given its size and greater number of issuers across both public and private entities in the corporate and sovereign issuer space.
“We are particularly focused on Blue Bonds, a sub-component of the green bond market, which finance ocean and freshwater related projects. However, Blue Bonds alone are not sufficient for investors looking to support ocean and freshwater themes while aiming to generate attractive risk-adjusted returns. A broader more holistic approach needs to start at the issuer level, investors should consider how a company operates, which products and services it offers, and how these align to the blue transition.”