AXA IM rebrands fund to invest for social progress
- AXA Investment Managers (AXA IM) has announced it will rebrand the AXA WF Framlington Women Empowerment Fund, with a view to broaden its social investing lens and align the strategy with AXA IM’s wider corporate purpose (‘Act for Human progress by investing for what matters’).
- The newly named AXA WF Framlington Social Progress Fund will continue to be managed by Anne Tolmunen and will invest in companies which make a positive societal contribution.
Launched in 2017, the AXA WF Framlington Women Empowerment fund invested in companies which were fostering gender diversity. As of April 10, the fund is renamed AXA WF Framlington Social Progress and expands its investment universe to address more widely all of the United Nations Sustainable Development Goals with a social focus.
The fund will invest in companies that address a range of social needs ranging from the most basic to more advanced needs that sustain human progress. The scale of unmet social needs creates opportunities for companies to improve outcomes for underserved people in both developing and developed countries.
The Sub-Fund of the Luxembourg-domiciled SICAV seeks both long-term growth and a sustainable investment objective by selecting companies that create financial and societal value by fostering social progress.
The Fund adopts a socially responsible “selectivity’ approach” selecting the best issuers based on their contribution to the socially-focused United Nations Sustainable Development Goals (“social UN SDGs”). This selective approach consists of reducing by at least 20% the investment universe, using a combination of external and internal SDGs alignment data.
The strategy is articulated around three critical areas of social needs:
- Access to affordable housing, essential infrastructure and financial & digital inclusion (UN SDGs 8, 9, 11);
- Protection through healthcare solutions and safety (UN SDGs 2, 3, 11,16);
- Progress by investing in companies which foster education, and entrepreneurship and wellbeing (UN SDGs 4, 5, 8, 9).
See Fig 1. below for a comprehensive look at the UN SDGs the strategy measures against.
The fund is part of AXA IM’s ACT fund range1, having been categorised as an Article 9 product according to the EU Sustainable Finance Disclosure Regulation (SFDR), and applies AXA IM’s Impact approach for listed assets, where the portfolio manager uses an impact approach in the securities selection process. Five percent of the management fees paid by the fund will continue to be donated by AXA IM to several charities supporting education (Epic Foundation), biodiversity & climate and health initiatives (Access to Medicine Foundation) among others. The Fund has received the French SRI label.
Anne Tolmunen, portfolio manager of the AXA WF Framlington Social Progress Fund, explains why investing in social progress makes sense: “At AXA IM, we strongly believe that as investors, we have a role to play in society, in shaping a more sustainable future not only for our clients, but also for our communities and the world we live in. With our social progress strategy, we are reinforcing our purpose.”
“We expect around 15% of adults globally (1 billion) to remain unbanked by 20222 and in 2016, 1.9 million deaths could have been prevented with adequate safe water, sanitation and hygiene3. There is still so much that needs to be done to foster social progress, and finance has a key role to play through the companies we, as an active asset manager, are investing in. This is the reason why we are expanding the investment universe of the fund.”
“The economic empowerment of women will continue to form a critical area of focus within the Social Progress fund, while promoting gender diversity in the workplace will continue to be a cornerstone of AXA IM’s active ownership agenda addressed through our reinforced engagement and voting capabilities4 and other initiatives such as the 30% Club Investor Group in France and in the UK5”.
The fund is registered and available to professional and retail investors in Austria, Belgium, Denmark, Finland, France, Germany, Italy, the Netherlands, Norway, Portugal, Singapore (restricted scheme only), Spain, Sweden, Switzerland and the UK.
The ESG data used in the investment process are based on ESG methodologies which rely in part on third party data, and in some cases are internally developed. They are subjective and may change over time. Despite several initiatives, the lack of harmonized definitions can make ESG criteria heterogeneous. As such, the different investment strategies that use ESG criteria and ESG reporting are difficult to compare with each other. Strategies that incorporate ESG criteria and those that incorporate sustainable development criteria may use ESG data that appear similar, but which should be distinguished because their calculation method may be different.
- The ACT range (internal classification): these assets invest with a purpose to support the transition to a more sustainable economy. Funds have been assigned thematics aligned to ESG and/or UN’s Sustainable Development Goals (SDGs) objectives. Active stewardship is a key focus for this range, with voting and engagement reporting available at fund level. This range encompasses sustainable and listed impact funds.
- World Bank, CIA, Citi’s Banking the next billion report, January 2020
- See : WHO’ Global review of WASH and health, 2020
- See: https://www.axa-im.com/content/-/asset_publisher/alpeXKk1gk2N/content/axa-im-to-expand-its-gender-diversity-voting-policy-for-both-developed-and-emerging-market-economies/23818
- See: Six asset managers call on French large caps to establish action plan to have at least 30% women in executive management teams by 2025