Powered by leading green bond management firm, new fund gives Canadian investors fixed-income exposure to impactful sectors
Genus Capital Management, a Vancouver-based asset manager that focuses on impact investing, is joining the first wave of firms to offer globally oriented green bond funds to Canadians.
The firm’s Global Impact Bond Fund has the ability to invest in green bonds as well as social and other types of sustainable bonds around the world. The green bonds, in particular, will be used to fund green projects such as renewable energy or low-carbon infrastructure developments.
“We see this as a hedge against the crisis of climate change, especially a hedge on the climate transition,” said Mike Thiessen, partner and Director of Sustainable Investment at Genus.
According to Genus, the fund is high-impact and employs a rigorous green bond validation system, making it a strong option for investors focused on making a difference around the world. A minimum of 80% of the fund will be made up of positive-screen impact investments, while 20% will contain more traditional fossil-free screened investments.
The fund will also apply a stricter set of criteria than other green bonds in Canada that focus on Canadian investments. For one thing, they may have allocations to railway companies, which Genus has chosen to exclude.
“We’ve decided we won’t invest in Canadian railway companies that make a significant portion of their sales from transporting oil and gas, nor will we use this fund to invest in oil and gas companies that are undertaking renewable energy projects,” Thiessen said. “Our criteria are more stringent.”
Alpha Fixe Capital, a leader in green bond management within Canada, manages the fund. Through that arrangement, the fund offers investors the chance to spread their capital across a range of impactful sustainable bonds, including 29% in the renewable energy sector, 17.69% in low-carbon buildings, and 15% in energy-efficient public transportation (as of May 27, 2021).
“The Impact Bond Fund strives to make an environmental impact, in areas such as renewable energy or green buildings, while making a solid financial return,” said Simon Senecal, partner and portfolio manager, Responsible Investment, at Alpha Fixe Capital.