Evli has launched its first fund which focuses on investing in green corporate bonds – the Evli Green Corporate Bond fund. The fund invests in green and sustainable bonds. Introduced by Evli’s distinguished fixed income team, with its successful track record of over 20 years in European credit, the fund is managed by Juhamatti Pukka, Head of Fixed Income at Evli and manager of the Evli Short Corporate Bond fund. Noora Lakkonen, Analyst at Evli’s Responsible Investment team and in charge of monitoring ESG factors for Evli’s corporate bond strategies, is responsible for the green bond analysis of the new fund.
The Evli Green Corporate Bond fund is a natural progression for Evli, given its significant advances in integrating ESG factors into all areas of portfolio management. Evli decided earlier this year to raise the theme of Responsibility to a strategic focus area. “This new fund responds to the growing investor demand for a larger allocation to green bonds, but also to the need to act against the unsustainable use of resources and global warming,” says Juhamatti Pukka.
“Green bonds offer the same credit risk as traditional bonds with the added feature that they support the transition to a more sustainable economy”, Noora Lakkonen adds.
While most green bond funds offer a broad fixed income solution across whole fixed income asset class from sovereign bonds to corporate bonds, the Evli Green Corporate Bond focuses on corporate bonds. Very few European green bond funds are dedicated solely to the corporate bond segment, and Evli's crossover approach enables it to seize interesting investment opportunities which are also responsible.
“We argue that our approach to investing in the green bond market via corporate bonds offers investors several advantages. Asset allocation is more efficient with more specified products. Moreover, the corporate sector plays a key role in developing a greener economy. Therefore, it is of high importance for the investor community to directly support the transformation of these companies when they are investing in projects advancing transition to low-carbon economy and social projects financed with green and sustainability bonds,” says Juhamatti Pukka.
About 6.9 trillion dollars of infrastructure investment is required annually until 2030 to meet the UN Sustainable Development Goals and the Paris agreement’s objectives, which represents real long-term investment opportunities in the corporate bond segment. Evli Green Corporate Bond allows investors to take advantage of a fast-growing segment. "In general, we believe that Green Bond issuers tend to be more forward-looking. Success in environmental and sustainability issues has a significant effect on long-term credit quality,” Juhamatti Pukka continues.
The Evli Green Corporate Bond fund invests in the European investment grade and high yield segments (fund minimum average rating: BBB-) and in unrated bonds up to a maximum of 20 percent in order to include Nordic corporate bonds as a continuation of Evli's successful, flexible, crossover investment strategy.
See also: Evli Green Corporate Bond website
Additional information:
Juhamatti Pukka, Head of Fixed Income, Evli Bank Plc, tel. +358 9 4766 9486, juhamatti.pukka@evli.com
Noora Lakkonen, Responsible Investment Analyst, Evli Bank Plc., tel. +358 40 356 3411, noora.lakkonen@evli.com
