Scottish Widows launch four new ESG funds

Scottish Widows has launched a new environmental solutions fund and three funds that track decarbonising benchmarks.

The Scottish Widows Global Environmental Solutions Fund focuses on directing pension investment into companies that provide solutions to environmental issues such as global greenhouse gas emissions, food security, pollution and biodiversity loss. It targets companies involved in advancing alternative energy generation and supply, clean mobility, transport and infrastructure sustainability, forestry, sustainable agriculture, biodiversity preservation and pollution prevention.

Developed with fund manager Schroders, the fund invests in companies that derive at least 50% of their revenues from goods and services that facilitate sustainable alternatives in transportation, electricity and heat production, water use, agriculture, or industrial manufacturing.

Scottish Widows has also launched three regional equities funds which track decarbonising benchmarks. These funds, managed for Scottish Widows by BlackRock and Abrdn, look to invest in companies involved in the transition to a low carbon economy. The funds are aligned with the decarbonisation objectives of the 2015 Paris Agreement with two of the funds tracking Paris-aligned indices which facilitate an immediate 50% reduction in carbon intensity, followed by an ongoing 7% reduction year-on-year. The UK fund tracks a Climate Transition index which also facilitates a 7% a year ongoing decrease, from an initial 30% reduction. The funds are:

Scottish Widows Emerging Markets Paris-aligned Index Equity Tracker Fund tracks the FTSE Emerging Markets Paris-aligned Index as a benchmark

Scottish Widows Developed World Paris-aligned Index Equity Tracker Fund tracks the FTSE Developed World Paris-aligned Index as a benchmark

Scottish Widows UK Climate Transition Index Equity Tracker Fund tracks the FTSE All Share Climate Transition Index as a benchmark

Maria Nazarova-Doyle, Head of Responsible Investments and Stewardship at Scottish Widows, says, “We recently called for the industry and government to tackle environmental crisis and nature degradation together through joined up, focussed action.* With the launch of our new fund, we’re taking steps ourselves towards driving major investment into better outcomes for the environment as well as our customers.

“We have an urgent imperative to support the companies attempting to drive the change our planet desperately needs, while protecting the savings and livelihoods of our members in the long run. More innovative solutions are on the horizon, but we must work together to ensure they become a reality.”