Morgan Stanley IM adds double sustainable fixed income launch

Morgan Stanley IM adds double sustainable fixed income launch
  • James Baxter-Derrington
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Morgan Stanley Investment Management has expanded its fixed income range with sustainable double launch.

The MS INVF Sustainable European Corporate fund and the MS INVF Sustainable European Strategic fund will be managed by the global fixed income team, which will take an "active approach to sustainable investing" while seeking returns in line with existing strategies.

The corporate fund will focus exclusively on corporate credit while the strategic fund will invest across the fixed income universe, including developed and emerging market treasury and sovereign bonds, supranational and agency bonds, investment grade and high yield corporate credit, as well as securitised products.

An exclusionary method is in place, resulting in issuers from "controversial sectors", including weapons, tobacco and coal, as well as firms with "poor sustainable business practices" being excluded from the funds.

ESG methodology 

Conversely, a focus will be applied to issuers with ESG scores in the top 80% of its sector, based on MSIM's proprietary ESG methodology.

Both funds will also have an objective of making a positive contribution across "key sustainability themes", including decarbonisation, the UN Sustainable Development Goals and by "maximising" green and sustainable bond allocation.

Navindu Katugampola, head of sustainable investing, fixed income and liquidity at MSIM, said the firm is "committed to creating products and solutions which integrate ESG in a holistic way without compromising returns".

Integration 

"We actively seek to identify holdings with a sustainable long-term competitive advantage by focussing on factors including ESG integration, social and environmental impact and active engagement."

Brian Weinstein, head of global fixed income for MSIM, added: "These two new funds are an evolution of existing market-leading funds. We have listened to feedback from our clients and drawn on expertise from across our team to create bespoke, next-generation sustainable investment products."

This article originally appeared in International Investment's sister title Investment Week 

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