Holland-based Robeco has launched an environmental, social and governance (ESG) index fund with exposure to emerging markets.
The Robeco QI Emerging Markets Sustaunable Enhanced Index Equities fund aims for a 20% higher ESG score than its benchmark, the MSCI Emerging Markets index.
The fund has also set an objective of reducing the environmental footprint, greenhouse gas emissions, water use, waste generation and energy consumption by 20% of its benchmark's scores.
The fund is available in seven different share classes with currency hedges in the US dollars, euro and Swiss franc. The D share class comes with a management fee of 0.70% and the other remaining share classes have a fee of 0.35%.
Robeco partnered with Credit Suisse Asset Management back in April to help support its factor indices.
Robeco’s active ownership team decides which companies are excluded from the fund by a vote and value-based decision. The fund then uses a quantitative stock selection criteria which range stocks according to sustainability and expected future performance. This takes into consideration factors such as valuation, quality and momentum.
Wilma de Groot, head of core quant equities at Robeco, commented: “The fund is an alternative to passive investing, and an interesting solution for investors looking for stable outperformance after costs, with a low tracking error.
“Our enhanced indexing strategies have a similar absolute risk profile as passive strategies but can generate better returns by actively integrating sustainability criteria as well as incorporating 50 years of factor investing research.”