In this white paper, our Emerging Markets Fixed Income team and Sustainability Centre spell out the reasoning behind a new investment strategy that targets companies that can help Asian cities achieve the sustainable changes they need to make to face up to the pressures of an over-stretched infrastructure, migration and climate change.
With Asian cities on a steep population growth trajectory, current infrastructure – already poor – could become overwhelmed. Add to that the increasing frequency of extreme climate events and the need for Asian cities to achieve sustainable change has never been more urgent. Helping them do so presents a compelling investment argument.
Our Sustainable Asian cities strategy covers critical areas that offer investors sector diversification opportunities:
- Enhancing urban mobility
- Improving infrastructure
- Promoting integrated development
- Improving health and educational facilities
- Investing in innovative technologies that support the areas above.
To achieve this, the strategy is designed to invest in a mixture of green, social, sustainability (GSS), and sustainability-linked bonds (collectively known as sustainable-labelled bonds) as well as conventional bonds from issuers who derive at least 20% of their revenues from this theme.
Please note that articles may contain technical language. For this reason, they may not be suitable for readers without professional investment experience.
Any views expressed here are those of the author as of the date of publication, are based on available information, and are subject to change without notice. Individual portfolio management teams may hold different views and may take different investment decisions for different clients. This document does not constitute investment advice.
The value of investments and the income they generate may go down as well as up and it is possible that investors will not recover their initial outlay. Past performance is no guarantee for future returns.
Investing in emerging markets, or specialised or restricted sectors is likely to be subject to a higher-than-average volatility due to a high degree of concentration, greater uncertainty because less information is available, there is less liquidity or due to greater sensitivity to changes in market conditions (social, political and economic conditions).
Some emerging markets offer less security than the majority of international developed markets. For this reason, services for portfolio transactions, liquidation and conservation on behalf of funds invested in emerging markets may carry greater risk.