Fidelity launches two new sustainable fixed income funds

The management company Fidelity announced today the expansion of its capabilities in sustainable fixed income with the launch of two new funds: the Fidelity Funds 2 - Sustainable Social Bond Fund and the Fidelity Funds 2 - Sustainable Global Corporate Bond Fund.

There are many challenges to advancing the UN's Sustainable Development Goals (SDGs), but not acting will have irreversible consequences. It is estimated that there is an annual financing gap of 4 trillion dollars between what is needed and what has been contributed to achieve the SDGs, with the bulk of these goals being of a social nature. This fact offers an opportunity to investors.

The funds will be managed by both Kristian Atkinson (main manager of the Sustainable Global Corporate Bond Fund) and Shamil Gohil (main manager of the Sustainable Social Bond Fund). Together, they have over 42 years of experience and are backed by Fidelity's extensive investment and sustainable investment resources worldwide.

Fidelity Funds 2 - Sustainable Social Bond

The Fidelity Funds 2 - Sustainable Social Bond Fund aims to increase capital and generate income by making sustainable investments. It invests at least 70% of its assets in debt securities issued by high credit quality companies (investment grade) from anywhere in the world and at least 80% of the portfolio is invested in bonds that have a social orientation. The fund invests in issuers that supply a product or service that contributes to the UN's social SDGs and in bonds that directly contribute to social themes through the use of the capital raised.

This new fund is part of a broader commitment by Fidelity to the development of thematic fixed income investment solutions that address climate change, biodiversity, water and social issues. The emphasis on these themes is due to a firm belief: bondholders have an important role to play in addressing these issues and helping to reduce the gap that exists in the financing required to address these issues. The new fund complements the company's current climate bond strategy through the Sustainable Social Bond Fund, which includes resilience and adaptation to climate change as one of its sub-themes and emphasizes the importance of improving the ability to adapt to the effects of climate change.

Fidelity Funds 2 - Sustainable Global Corporate Bond

For greater diversification, the Fidelity Funds 2 - Sustainable Global Corporate Bond Fund aims to achieve capital appreciation and generate income through sustainable investments. At least 70% of its assets will be invested in debt securities issued by high credit quality companies (investment grade) from anywhere in the world. These securities will contribute to environmental or social objectives that are in line with one or more UN SDGs, offering a more diversified approach compared to pure thematic funds.

Both funds are covered by the Article 9 of the Regulation on the disclosure of financial information on sustainability (SFDR), which means that 100% of the assets, discounting liquidity and hedging instruments, will be allocated to “sustainable investments”.

We are delighted to expand our range of sustainable funds with these latest launches, which are part of our determination to offer clients the ability to invest in strategies in line with the SDGs and Article 9 of the SFDR. These funds constitute a solution that complements our sustainable global equity strategies and provides clients with a set of sustainable components for their portfolios. In addition, they add to the achievements we are making in the development of the climate bond strategy, which recently surpassed the barrier of 320 million dollars in managed assets.

Christophe Gloser, Head of Distribution for Europe at Fidelity International