The Dutch pension asset manager's Asia Pacific head of real estate says his team has just had one of its busiest years ever and that 2021 is looking similarly promising.
The new fund, which will be available to investors from the end of this month, will be a global equities fund managed by IDEAM, a specialist team within French fund management group Credit Agricole Asset Management.
According to Peter Crewe, regional pensions director at AIG Global Pensions Asia, the new fund will allow MPF members to, "combine environmentally friendly investment with a strong financial performance".
"With increasing environmental awareness, pressure exerted on companies to act in a socially-responsible and environmentally-friendly was has never been higher. We believe companies that can live up to, and exceed these expectations will enjoy a strong, positive impact on their long-term business success," he says.
IDEAM, which was officially set up in 2003, has been managing SRI funds since 1989, when its first ethical fund was offered in Paris.
The group's president, Xavier de Bayser, says the new fund is, "not just innovative for Hong Kong, but for Europe too".
"These type of green funds are generally just available to institutions," he adds. "For this one to be made available to the wider public will make it a benchmark not just for Hong Kong, but for the world."
Environmentally-friendly and ethical funds have flourished in recent years, with SRI-related funds in the US growing from $12 billion in 1995 to nearer $179 billion last year.
In addition, Watson Wyatt recently identified the environment as one of the key influencing factors in the global funds industry in the next ten years.
Hong Kong, in particular, has seen a surge of interest in SRI since 2003 when SARS hit the region.
Nicolas Sauvage, head of business development at Credit Agricole, downplays suggestions that "green funds" are prone to underperforming more traditional funds.
"In the past three years, SRI funds we've been managing have outperformed their benchmark, the MSCI World index, by at least 1% per annum," he comments.
The launch of the Green Fund takes AIA-JF's fund choices up to fifteen, and further broadens the joint-venture's multi-manager platform.
Mega players Nippon Life and Dai-ichi Life are looking for opportunities in higher-yield single-A US corporate bonds, which offer more appealing yields than stagnant domestic offerings.
The “lower for longer” monetary policy and stimulus packages, coupled with the rolling out of vaccine programmes favorably support real estate investing in the region, with offices and data centres presenting forward-looking opportunities.
As US fixed income default rates rose and yields fell during the pandemic, are Asian bonds, which have had more stable yields through 2020, looking more attractive?
Insto roundup: Norway's Oil Fund praises China governance efforts; NPS commits $100m to taxi-hailing app
Norway's Oil Fund welcome Chinese proposals improving transparency and shareholder protection; HK's MPF assets surge 35% year on year; Korea's NPS commits $100m to TPG consortium to invest in taxi-hailing app; Poba commits W270bn to European property; Malaysia's EPF sees investment income rise 59% year-on-year in first quarter, and more.