Close Brothers Asset Management (CBAM) has launched two new sustainable funds which aim to generate consistent long-term returns by screening out unethical practices while focusing on investment opportunities with positive ESG and sustainability records.

The asset manager said demand from advisers is one of the reasons they chose to develop the actively managed funds.

There has been an increased focus on sustainable investing since the beginning of the Coronavirus pandemic. Last week Cheshire-based Equilibrium Financial Planning, which manages £1bn for clients, committed to invest client money only in fund groups that meet ESG criteria. 

In September wealth management and financial advice trade association PIMFA launched The ESG Academy for Financial Planners who want to learn more about ESG investing. 

The Close Sustainable Balanced Portfolio Fund will be managed by Riitta Hujabnen (head of funds) and Richard Stroud (investment manager). It aims to provide capital growth with some income over the medium term, investing in shares, bonds, alternatives, ETFs and third-party funds.

The Close Sustainable Bond Portfolio Fund has been launched as a replacement for the Close Bond Income Portfolio Fund and will be managed by Andrew Metcalf (investment director) and Eran Hasson (Investment manager). It aims to generate income while maintaining its capital value over the medium term. The fund will invest in bonds, third party funds, and other fixed income securities, with a new investment approach and fund prospectus.

The new funds are part of CBAM’s sustainable investment proposition.

Martin Andrew, chief executive of Close Brothers Asset Management, said: “Investors and clients are becoming more aware of how their money can affect the world around them and increasingly want to invest in ways that reflect their concern and respect for the natural environment, for human dignity and for responsible corporate behaviour.  We are launching these new funds to meet this demand.”

Several investment houses and platforms have launched new sustainable funds so far in 2020.

Yesterday AJ Bell launched its Responsible Growth Fund. AJ Bell's new fund will invest in responsibly screened ETFs which remove stocks from controversial businesses such as tobacco or alcohol. In its launch announcement AJ Bell CIO Kevin Doran said that responsible investing is "something that clients are increasingly asking advisers about."