Fidelity to open 2021 with five further sustainable funds

AJ Gonzalez | November 18, 2020

Investment Week, James Baxter-Derrington, 17 November 2020

Three of the new Luxembourg-domiciled funds will be regional focused portfolios and will join the Sustainable Family, while the remaining two will offer investors access to thematic investments, with each fund seeking long-term capital growth.

To be part of the Sustainable Family, a fund must hold at least 70% in companies with MSCI-rated ESG scores of at least BBB, with the remaining 30% requiring improving ESG trajectories.

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Managed by Dhananjay Phadnis and supported by Flora Wang, director for sustainable investing, the Fidelity Funds – Sustainable Asia Equity fund aims to deliver long-term capital growth through a diversified portfolio of sustainable stocks across Asia excluding Japan and will be available from 24 February 2021 for an ongoing charge figure (OCF) of 1.08%.

The Fidelity Funds – Sustainable European Smaller Companies fund targets small and medium-sized European companies and will be lead managed by Jim Maun, who will be supported co-portfolio manager Joseph Edwards, which is available from 13 January 2021 for an OCF of 1.1%

Rounding off the regional funds and launching on 3 March 2021 is the Fidelity Funds – Sustainable Japan Equity fund, which will invest in Japanese companies with “attractive growth characteristics, above average returns and strong balance sheets” and will be lead managed by Hokeun Chung and supported by assistant portfolio managers Tomohiro Ikawa, Cenk Simsek and Eddie Tajima. It will have an OCF of 1.09%.

The Fidelity Funds – China Innovation fund will be the first of the new thematic products to launch, on 24 February 2021, and will be co-managed by Tina Tian and Casey McLean, who will invest in Chinese equities “linked to the theme of innovation”, for an OCF of 1.1%

The final new portfolio will be the Fidelity Funds – Global Thematic Opportunities fund, which will consist primarily of global equities, including emerging markets, and will be managed by Nick Peters and supported by Ayesha Akbar. It will invest in multiple long-term market themes through ownership of securities that benefit from “structural and/or secular” changes in economic and social factors for an OCF of 1.05%.

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Christophe Gloser, head of sales, continental Europe at Fidelity International, said: “Ultimately, our clients’ goals are fundamentally aligned with those of society and it is our place to ensure we represent them in the best way possible. Like them, we believe that by investing in companies which operate with high standards of sustainability we can protect and enhance investment returns for our clients.”

Jenn-Hui Tan, global head of stewardship and sustainable investing, Fidelity International, added: “We have responded to our clients’ demands in recent years by substantially developing our in-house resources to scrutinise and map sustainability risks, including the introduction of our proprietary sustainability ratings which form the cornerstone of our ESG analysis.

“Our Sustainable Family has grown from five to eleven funds in just over a year, and I fully expect this trend to continue in line with rising regulatory focus and increasing client demand.”

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