New HSBC Sterling ESG Liquidity Fund
We recently learned about the launch of HSBC Sterling ESG Liquidity Fund. The announcement says, "HSBC Asset Management is proud to announce the launch of a new ESG money market fund (MMF), the HSBC ESG Sterling Liquidity Fund. The fund will be available for investors seeking a Low Volatility Net Asset Value (LVNAV) money market fund that invests in issuers that are better at addressing ESG factors.... The HSBC ESG liquidity investment strategy has been developed to address the evolving priorities of our clients. Building on the highest rated ESG Integration platform serving all HSBC MMFs our new ESG specific MMFs are designed to deliver more sustainable outcomes by focusing on the ESG performance of those issuers that our funds can invest in. Our innovative approach to sustainable investment within money market funds follows a Best-in-Class strategy to ESG investing. We are able to identify the issuers that demonstrate they are best at addressing ESG issues and we apply HSBC Asset Management's 20+ years of responsible investment expertise to create a more sustainable list of high-quality issuers from which we construct our portfolios. The result is a meaningful improvement in ESG score compared to the money market investable universe." An October 12 press release, entitled, "HSBC Sterling ESG Liquidity Fund Assigned 'AAAm' Principal Stability Fund Rating," explains, "S&P Global Ratings today assigned its 'AAAm' principal stability fund rating (PSFR) to HSBC Sterling ESG Liquidity Fund (the fund), a Dublin-domiciled, short-term money market fund (ST MMF) sponsored by HSBC Investment Funds (Luxembourg) S.A. and managed by HSBC Global Asset Management (France). The fund launches today and is part of HSBC Asset Management's (HSBC AM) expanded money market fund product range. It is classified as a low volatility net asset value (LVNAV) fund under EU MMF regulation and reflects the rising consideration for environment, social, and governance (ESG) factors. According to the prospectus, the fund complies with Article 8 of the EU Sustainable Finance Disclosure Regulation by promoting environmental or social characteristics. To achieve this, the fund invests in a variety of high-quality, money market instruments eligible under EU MMF regulation, including certificates of deposits, commercial paper, asset-backed securities, government and corporate bonds, bank deposits, and reverse repurchase agreements. The fund will maintain a weighted-average maturity of 60 days or less and a weighted-average life of 120 days or less." S&P adds, "The investment manager will not only exclude controversial sectors such as tobacco, nuclear armaments and other weapons, and high fossil fuels, but also screen issuers to select for "best in class" issuers, by HSBC AM's ESG factors. The manager will screen the HSBC Sterling ESG Liquidity Fund's theoretical investable universe of issuers by their relative ESG scores, adherence to the United Nations Global Compact, and sector-specific tests, to identify suitable issuers in which to invest." For more on ESG and Social MMFs, see these recent Crane Data News stories: "Dreyfus CIS Announces ESG Integration Into Credit Analysis Via Filing (9/28/21), "Goldman Launching Loop Capital Class to Support Black Women in STEM" (9/20/21), "BlackRock Converts Fed Trust to Social MMF; CastleOak Expands Team (9/15/21), "BlackRock Expands ESG Lineup; Files for New Bancroft, Cabrera Shares (8/19/21), "Northern Renames Diversity Shares Siebert Williams; Safened Platform (4/20/21); "Morgan Stanley Files for CastleOak Shares; Bond Fund Symposium Today" (3/25/21); "JP Morgan Launches "Empower" Share Class to Support Minority Banks" (2/24/21); "Invesco Files for Cavu Secs Class" (12/18/20); "ESG and Social MMF Update: Mischler News, Green Deposits, Reg Debate" (12/4/20); "Goldman Launches Social Class; Tiedemann Adds FICA; CS Green ABCP" (1/24/20); "Mischler Financial Joins "Impact" or Social Money Market Investing Wave" (12/5/19); and "Dreyfus Launches "Impact" or Diversity Government Money Market Fund" (11/21/19). (Let us know if you'd like to see our listing of ESG and Social money market funds too.)
