HSBC and Schroders partner in Singapore on ESG Multi-Asset Fund

Schroder Investment Management (Singapore) has reportedly launched the Schroder ISF Sustainable Multi-Asset Income (SMAI), a multi-asset fund to be exclusively distributed by HSBC Singapore.

Schroders has reportedly said that it is one of the first asset managers globally to launch a new multi-asset fund that is focused equally on delivering income and sustainability outcomes, as reported by International Investment .

The new strategy is said to assist investors in contending with the challenges of persistently low yields and an increased urgency to prioritise rising sustainability risks heightened by Covid-19 and climate events, reports International Investment.

Lily Choh, Deputy CEO, Singapore, and Head of Distribution, Southeast Asia, Schroders, said: “The pandemic has sharpened focus on environmental, social and governance (ESG) risk with recognition amongst investors and institutions over how these factors are becoming increasingly material to investment outcomes. The findings from Schroders' latest Global Investor Study reinforce this belief: 43% of investors in Singapore now frequently invest in sustainable investment funds, a marked increase from 31% two years ago.”

“Sceptics have long argued that growing interest in sustainability would not be supported as markets become more challenging. On the contrary, the current crisis has put sustainable investment in the forefront of investors' minds with growing evidence that sustainable business models are more resilient and better able to withstand market shocks. For investors seeking income, this challenges the notion that there needs to be a trade-off and you must forgo attractive income if you are investing sustainably.”

“Since 2000, we have engaged actively with management teams to promote more sustainable business practices and have driven change in the industry through a number of investor initiatives, such as pushing for greater transparency and disclosure on sustainability-related risks and opportunities,” Choh continued.

“We are very pleased to partner exclusively with HSBC Singapore for the distribution of this fund, given our shared commitment to sustainability and in making sustainable investing more accessible to all investors in Singapore,” Choh concluded.

The newly-launched fund will be accessible to HSBC customers for as little as SNG1,000; although the fund’s base currency is euro, the fund will also offer Singapore dollar-, US dollar- and Australian dollar-hedged classes to investors.

The fund reportedly aims to generate a natural base level of income of 3 to 5% p.a., which will be paid monthly to investors, and will invest in a diverse range of asset classes and regions, including investments that target better sustainable outcomes like carbon neutral equities and green bonds.

Ian Yim, Head of Wealth and International, Singapore, HSBC, said: “ESG issues continue to play a key and integral part in how we unlock sustainable investment opportunities for our clients. Recent global climate events have further heightened the urgency for our customers to pivot towards a more sustainable future - not just in terms of how they live, but also how they can invest responsibly.”

“HSBC's commitment to furthering sustainability includes pledging USD100 billion globally in sustainable financing and investments by 2025.  While closer to home, we plan to expand our range of sustainable investment products and solutions offered to customers across the wealth continuum.”

“The Schroder ISF Sustainable Multi-Asset Income fund, being one of the first of its kind in the market, compliments our range of ESG fund strategies. This fund balances our customers' search for yield amidst the current low interest rate environment and their desire to make a difference to our environment. In addition, Schroder's overall resources and expertise in the ESG space gives added assurance to our clients that their funds are being channelled to companies that are aligned to their beliefs,” Yim concluded.