BNP Paribas Asset Management expands index fund range with launch of green, social & sustainability bond ETF
BNP Paribas Asset Management (‘BNPP AM’) announces the launch of an index fund focused on green, social and sustainability bonds, integrating an ESG[1] approach. Listed since 7 April 2022 on Euronext Paris and Deutsche Börse Xetra, the fund is classified as SFDR[2] Article 9.
This is BNPP AM’s third ETF[3] launch since the start of the year and continues the development of its sustainable and thematic index fund range, including low carbon, circular economy, blue (i.e. ocean) economy, green real estate and sustainable infrastructure, as well as medical technology and green hydrogen, launched in March.
BNP Paribas Easy JPM ESG Green Social & Sustainability IG EUR Bond replicates the JP Morgan ESG Green, Social, & Sustainability IG EUR Bond Index, consisting of euro-denominated bonds from both developed and emerging markets, with a focus on green bonds aligned with the objectives of the Paris Agreement. The index uses a rating and selection methodology to select issuers with the best ESG profiles[4], and offers exposure to bonds designed to provide direct and measurable exposure to activities funding projects in the following areas:
- Environmental, such as renewable energy infrastructure.
- Social, such as programmes to combat unemployment.
- A combination of environmental and social, through projects that meet the UN's Sustainable Development Goals (‘SDGs’).
Constituent selection is based on the Climate Bonds Initiative[5] (‘CBI’) database. Bonds issued by non-sovereign issuers that do not respect the principles of the United Nations Global Compact (‘UNGC’) or derive revenue from thermal coal, tar sands, tobacco or weapons are excluded from the index.
Denis Panel, Head of Multi-Asset, Quantitative & Solutions (‘MAQS’) at BNPP AM, comments:
“Growing client demand for sustainable bonds leads us to offer relevant long-term investment solutions. This new fund expands our range of sustainable fixed income index funds and demonstrates our desire to be a key provider of thematic ESG ETFs.”
Key fund characteristics as at 7 April 2022
Fund name BNP Paribas Easy JPM ESG Green Social & Sustainability IG EUR Bond ETF
ISIN code LU2365458814 (Cap); LU2365458731 (Dist)
Replication method Physical
Dividend policy Capitalisation; Distribution
Currency EUR
OCF(a) 0.25%
SFDR category(b) 9
AMF category(c) 1
SRRI(d) 3
(a) Ongoing charge (on an annual basis)
(b) Sustainable Finance Disclosure Regulation 2019/2088 of the European Parliament and of the Council of 27 November 2019 on information to be provided on sustainable development in the financial services sector. Article 8 - product promoting environmental or social characteristics. Article 9 - product with a sustainable investment objective.
(c) AMF (Autorité des marchés financiers) Doctrine Category 1 - commitment approach.
(d) Synthetic Risk and Reward Indicator is determined on a scale of 1 to 7 (7 being the highest level of risk). It is calculated on a periodic basis and may therefore change over time. Regular consultation of the Fund's KIID/DICI is recommended.
- ENDS -
Footnotes
- ^ [1] Environmental, Social & Governance
- ^ [2] Sustainable Finance Disclosure Regulation
- ^ [3] Exchange Traded Fund
- ^ [4] Issuers are scored from 0 to 100 using ESG scores from third party research providers
- ^ [5] Climate Bonds Initiative (‘CBI’) is an international, non-profit organisation for investors that works to mobilise the bond market for solutions to climate change.
BNP Paribas Easy is a Luxembourg SICAV in accordance with Directive 2009/65/EC. Investments made in funds are subject to market fluctuations and the risks inherent in investments in transferable securities. The value of investments and the income from them can go down as well as up, and investors may not get their full investment back. The funds described present a risk of capital loss. For a more complete definition and description of risks, please refer to the fund prospectus and KIID. Before subscribing, you are advised to read the most recent version of the prospectus and KIID, available free of charge on our website www.easy.bnpparibas.com. Past performance is no guarantee of future performance.
Risk relating to the inclusion of ESG criteria: the absence of common or harmonised ESG and sustainability criteria definitions and labels at the European level may lead to different approaches by management companies when defining ESG objectives. It also means that it can be difficult to compare strategies incorporating ESG and sustainability criteria, as the selection and weightings applied to certain investments may be based on indicators which may share the same name, but have different underlying meanings. When evaluating a security on the basis of ESG and sustainability criteria, the management company may also use data sources provided by external ESG research providers. Given the evolving nature of ESG, these data sources may currently be incomplete, inaccurate or unavailable. The application of responsible business conduct standards as well as ESG and sustainability criteria in the investment process may lead to the exclusion of the securities of certain issuers. Consequently, fund performance may sometimes be better or worse than the performance of collective investments with a similar strategy.
BNP PARIBAS ASSET MANAGEMENT UK Limited, ‘the investment company’, is authorised and regulated by the Financial Conduct Authority. Registered in England No: 02474627, registered office: 5 Aldermanbury Square, London, England, EC2V 7BP, United Kingdom.
This material is produced for information purposes only and does not constitute:
- an offer to buy nor a solicitation to sell, nor shall it form the basis of or be relied upon in connection with any contract or commitment whatsoever or
- investment advice.
This material is issued and has been prepared by the investment company. It contains opinions and statistical data that are considered lawful and correct on the day of their publication according to the economic and financial environment at the time. This document does not constitute investment advice or form part of an offer or invitation to subscribe for or to purchase any financial instrument(s) nor shall it or any part of it form the basis of any contract or commitment whatsoever.
Whilst the fund described herein has been established as a UCITS (in accordance with the UCITS Directive) in Luxembourg, it has not been registered in the UK, therefore the promotion of this fund and the distribution of this document in the UK are accordingly restricted by law.
This document is provided without knowledge of an investors’ situation. Prior to any subscription, investors should verify in which countries the financial instruments referred to in this document are registered and authorised for public sale. In particular, financial instruments cannot be offered or sold publicly in the United States. Investors considering subscriptions should read carefully the most recent prospectus and Key Investor Information Document (KIID) agreed by the regulatory authority, available on the website. Investors are invited to consult the most recent financial reports, which are also available on the website. Investors should consult their own legal and tax advisors prior to investing. Given the economic and market risks, there can be no assurance that the financial instruments will achieve their investment objectives. Their value can decrease as well as increase. In particular, changes in currency exchange rates may affect the value of an investment. Performance is shown net of management fees and is calculated using global returns with time factored in, with net dividends and reinvested interest, and does not include subscription-redemption fees, exchange rate fees or tax. Any gross of fees performance included in this material do not reflect the deduction of commission, fees and other expenses incurred. Returns will be reduced after the deduction of such fees. Past performance is not a guarantee of future results.
This document is directed only at person(s) who have professional experience in matters relating to investments (‘relevant persons’). Any investment or investment activity to which this document relates is available only to and will be engaged in only with Professional Clients as defined in the rules of the Financial Conduct Authority. Any person who is not a relevant person should not act or rely on this document or any of its contents.
All information referred to in the present document is available at www.bnpparibas-am.com.
This is a Marketing Communication for Professional Investors only. No assurance can be given that any forecast, target or opinion will materialise.
As at April 2022.
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About BNP Paribas Asset Management
BNP Paribas Asset Management (‘BNPP AM’) is the investment arm of BNP Paribas, a leading banking group in Europe with international reach. BNPP AM aims to generate long-term sustainable returns for its clients, based on a sustainability-driven approach. BNPP AM’s investment capabilities are focused around five key strategies: High Conviction Strategies, Private Assets, Multi-Asset and Systematic & Quantitative Investments (SQI), Emerging Markets and Liquidity Solutions, with investment processes incorporating quantitative and fundamental analysis.
Sustainability is core to BNPP AM’s strategy and investment philosophy. Among the leaders in thematic investment in Europe1, BNPP AM intends to contribute to the energy transition, environmental sustainability and the promotion of equality and inclusive growth globally. BNPP AM currently manages EUR 526 billion of assets (EUR 641 billion of assets under management and advisory) and benefits from the expertise of more than 500 investment professionals and around 400 client servicing specialists, serving individual, corporate and institutional clients in 68 countries.
Source: BNPP AM, as at 31 March 2023
1 Source: 2nd in Europe for active sustainable thematic strategies, according to BNP Paribas Asset Management analysis based on Morningstar data as at 31/12/2022.
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