BNP Paribas Asset Management launches its first active equity fund targeting the transition to a zero-net-emissions economy

BNP Paribas Asset Management announces the launch of the BNP Paribas Global Net Zero Transition Equity Fund, a Luxembourg-domiciled equity fund offering investors exposure to a well-diversified strategy across sectors, regions and market capitalisations, with a sharp focus on decarbonisation and an overweight to sustainable investing.

• One of the few actively managed equity funds in the market whose primary objective is to adhere to the zero net emissions commitment from a fair transition perspective.
• A diversified portfolio across sectors and regions with a broad investment universe showing little or no preference for a particular style, region or sector relative to the benchmark.
• A fundamental behavioural approach with the objective of consistently outperforming its index.
• The fund's objective is to reduce GHG emissions and manage an implied temperature rise (ITR) below 2°C.

The zero net emissions target can be achieved by investing in companies that offer and embrace decarbonisation solutions, thereby contributing to the achievement of that target. With this new equity fund, we aim to offer an innovative strategy that is in line with BNP Paribas Asset Management's commitments to achieve net zero emissions while leveraging our social and environmental expertise and our focus on active dialogue with companies

Nadia Grant, Head of Global Equities and Fund Manager

The BNP Paribas Global Net Zero Transition Equity fund is a high-conviction portfolio. Its initial universe is based on the selection of a pool of 1,000 international companies working towards the goal of net zero emissions from a fair transition perspective. The portfolio is diversified by region, size and sector, with a good representation of the technology, industry and materials sectors, thereby resulting in reduced sector risk versus the benchmark. The universe includes companies offering and adopting solutions that contribute to the reduction of greenhouse gas emissions, with an implied temperature increase target of less than 2°C.

The fund is actively managed and uses the investment process and philosophy of the manager's global equity team, which is rooted in behavioural finance. In selecting portfolio holdings and assessing companies' commitment to net zero emissions, the team uses the BNP Paribas Asset Management Sustainability Centre's proprietary net zero emissions framework, inspired by the investment framework of the Paris Aligned Investment Initiative.

It is classified as an Article 8 fund under the SFDR and is committed to investing at least 50% of the portfolio in companies classified as "sustainable" under BNP Paribas Asset Management's implementation of the SFDR.

The launch of the BNP Paribas Global Net Zero Transition Equity fund is a further milestone in BNP Paribas Asset Management's published roadmap to achieve net zero emissions. The roadmap, published in November 2022, states that by 2023, 60% of investments should be in companies that have achieved the net zero emissions target or have adjusted or are adjusting their performance towards it, rising to 100% by 2040.

We are delighted to launch our first fund that invests exclusively in the universe of companies that meet the criteria of our 'AAA' net zero emissions framework: that is, companies that are achieving, are aligned with or aligning to the net zero emissions target. Using this framework as a starting point sets a clear ambition for the companies that will be in the portfolio in a client-friendly way. This fund is also one of our first steps in incorporating a specific Fair Transition perspective into our investment decision-making process and dialogue. Greening the economy offers the potential to create jobs and build new industries. A 'fair transition' must be equitable and inclusive and create decent work opportunities. It is an important part of how investors should assess and engage with companies during this transition period.

Jane Ambachtsheer, Global Head of Sustainability at BNP Paribas Asset Management

BNP Paribas Global Net Zero Transition Equity will also include a charitable class to fund Electriciens Sans Frontières, whose mission since 1986 has been to fight inequalities in access to electricity and water around the world. With the help of our 1,200 volunteers and thanks to partnerships with local actors and the use of renewable energies, the NGO and registered charity turns access to electricity into a tool for human and economic development. It aims to reduce energy poverty, fight climate change and promote the energy transition.