M&G Investments has upped its high yield offering with the launch of a global ESG-driven bond fund, the company has announced.
The M&G ESG Global High Yield fund will be available to European investors and will be managed by James Tomlins and Stefan Isaacs, who currently manage several funds, including the M&G Global High Yield Bond Sterling fund.
The fund will invest at least 80% of its assets in global high yield bonds to form a flexible and highly diversified portfolio in terms of issuers, geographies and sectors.
ESG considerations will be fully integrated into the investment process through a 3-stage screen. The first will exclude companies in breach of the United Nations Global Compact principles.
The second layer filters out companies deriving revenues from specific sectors such as tobacco, alcohol, adult entertainment, gambling, thermal coal, defence and weapons.
The fund will also exclude any companies classified as industry laggards displaying poor ESG credentials compared to industry peers. This stage involves analysis of issues such as energy efficiency and pollution to working conditions and product safety.
Commenting on the launch, M&G’s CIO for equity, multi-asset and retail fixed interest, Graham Mason said: ‘The fund aims to provide a solution for those investors looking for higher-yielding strategies in the fixed income space while incorporating responsible investing criteria.'