UBP launches ESG sovereign EM debt strategy

Union Bancaire Privée has launched a new emerging market ESG sovereign local-currency debt strategy.

The strategy invests in ESG bonds that have been issued by sovereign and supranational entities in emerging markets and are denominated in local currencies. It is classified as Article 8 of the EU’s Sustainable Finance Disclosure Regulation (SFDR) and will be managed by UBP’s EM fixed income team lead by portfolio manager Lamine Bougueroua.

Philippe Lespinard, Head of Asset Management (London) and Head of Alternative Fixed Income at UBP, says, “This strategy is an important achievement for our Emerging Markets Fixed Income team who have worked hard to develop a proprietary ESG and risk model in sovereign debt. We believe that this unique approach to EM local-currency debt, which combines risk parity with a focus on sustainability, ensures better diversification and risk-adjusted returns over time. Recent events have validated this approach, as we have excluded Russian government bonds from the portfolio since the strategy’s inception.”