BNP Paribas AM launches Article 9 bond fund targeting smart cities in Asia
BNP Paribas Asset Management (BNPP AM) has launched a thematic fixed income Sicav strategy that targets sustainable urbanisation growth opportunities in Asia.
The BNP Paribas Sustainable Asian Cities Bond fund invests in sustainable labelled bonds where the use of proceeds goes towards sustainable infrastructures such as clean transport, renewable energy and healthcare infrastructure.
It also targets ESG-screened bonds from issuers that derive at least 20% of their revenue from smart grid technology products or enablers of sustainable Asian cities, such as real estate developers.
BNPP AM’s head of emerging market fixed income, Jean-Charles Sambor, will run the strategy. He highlighted the need for sustainable infrastructure development capital in Asia as a multi-decade secular growth trend.
Xuan Sheng Ou Yong, green bonds and ESG analyst at BNPP AM said that the large population, coupled with increased urbanisation and higher frequency and intensity of physical climate change impacts, means Asian cities urgently need to become sustainable.
The firm said the fund, domiciled in Luxembourg, is the first Asian-focused fixed income strategy to be classified as Article 9 under Sustainable Finance Disclosure Regulation and signals a growing ESG interest in the region among European investors.
Last month, ESG pioneer Sasja Beslik also tapped into the space by launching the first Article 9 fund in Asia, which invests in the sustainable transition of Japanese small- and mid-cap businesses.