French asset manager Carmignac will convert its commodities fund into a "socially responsible thematic equity fund" that will invest in companies leading the charge against climate change, Investment Week has reported.
The Paris-based firm has written to unitholders informing them it will rebrand its €227.4m Carmignac Portfolio Commodities to Carmignac Portfolio Green Gold on 15 May. The fund will continue to be managed by Michel Wiskirski and will see its fees remain at a 0.85% AMC and 1.17% OCF.
Carmignac said the rebrand would help it to "challenge the traditional investment approach to climate change". As of next month, the fund will invest in "companies providing products or services that are actively addressing climate change mitigation".
The fund will not only invest in companies that provide low carbon solutions, but will go further by investing in companies enabling others to achieve emissions reduction, energy efficiency or provide low carbon solutions - copper for wind turbines, for example."
"To achieve this, the fund will not only invest in companies that provide low carbon solutions, but will go further by investing in companies enabling others to achieve emissions reduction, energy efficiency or provide low carbon solutions - copper for wind turbines, for example," Carmignac told Investment Week.
"In addition, it will invest in companies which we believe have the best emission reduction potential and whose efforts will contribute to achieving a target of net zero emissions by 2050."
The fund held miners Newmont and Barrick Gold within its top ten positions as at 31 March, and Carmignac said it would completely transition the strategy after 15 May, "giving holders one month to redeem under the current strategy."
"The current top ten holdings include companies offering a varied solution of renewable energies and waste management which has been part of the investment strategy already for some months," the firm said. These include Orsted and Waste Management Inc, alongside miners such as Newmont and Barrick Gold.
This article was first published by Investment Week