Swedish pension fund Alecta invests USD 100M in the NN-FMO Emerging Markets Loan Fund1 september 2017
Alecta allocates 100 million dollars to invest in the NN-FMO Emerging Markets Loan fund. To Alecta, this investment presents an attractive opportunity to finance sustainable development projects while generating stable returns to our beneficiaries.
As the Agenda 2030 and the UN Sustainable Development goals are increasingly immersed in the discussions in the corporate and financial arena, impact investing is emerging as a strong theme within responsible and sustainable investment.
“At Alecta, we are convinced that long-term perspective and ESG integration, together with a focus on cost efficient asset management, creates conditions for strong value creation over time. Therefore, we have been increasingly active in identifying other sustainable investment opportunities that match our investment strategy, with green bonds being the most established asset class. This is an investment that meets our required rate and also has a positive sustainability impact”, says Magnus Billing, CEO of Alecta about the NN-FMO fund.
For the past years Alecta has worked to integrate sustainability and ESG considerations into the investment decisions, which is a good fit with the equity portfolio strategy of active ownership and investments in carefully selected companies with a sound business model.
FMO is the Dutch development bank with experience of emerging market loans in more than 85 countries. With a thorough model to assess ESG risks and a strong commitment to improving the ESG performance of clients, as part of the robust sourcing and monitoring process, FMO has delivered stable returns with impressively low write-offs. Behind the results is a dedicated organization with the sole mission to improve the lives of people in developing countries by investing in projects that create local prosperity through job creation and responsible business practices.
“This commitment by Alecta is a fantastic acknowledgement of our work, investing in private sector businesses across emerging and frontier markets to generate social and environmental impact and attractive financial returns. By putting its vision into action, Alecta leads the way. We encourage other asset owners to follow their example. This fund will allow FMO to scale up our joint contribution to the Sustainable Development Goals”, says Yvonne Bakkum, Managing Director of FMO Investment Management.
“We are extremely proud that we have been able to create an innovative solution to facilitate institutional investors to invest responsibly and with impact in Emerging Markets. We have done this in partnership with FMO, a recognised leader in Sustainability. We congratulate Alecta on their 100 year anniversary and we are delighted that Alecta, one of Europe’s leading institutional investors for integrating sustainability, has committed to realizing this solution”, says Arno van den Heiligenberg, Head of Nordics at NN Investment Partners.
In a first round Alecta has committed to invest 100 million USD, and NN-FMO are now in discussions with other investors. The fund is expected to make a first close in the fourth quarter, 2017.
“Another strong feature is the FMO Impact model, to monitor measurable impact in terms of jobs supported, SMEs reached, additional scope indicators and avoided GHG emissions. This is very much aligned with the ambition of the Sustainable Development Goal 8, on decent work and economic growth. During 2017 we have been working on this goal together with other investors in a collaboration with the Swedish development agency Sida”, says Magnus Billing, CEO of Alecta.
Alecta is a Swedish occupational pension fund, with 800 billion SEK under management. The investment strategy is to have an equity portfolio of carefully selected companies and business models, integrating ESG analysis in the investment decisions. Currently Alecta has green bonds to a value of 14 billion SEK. Alecta is a signatory to the UN Global Compact and the UN Principles for Responsible Investments, and CEO Magnus Billing is a member of the current EU High-Level Expert Group (HLEG) on Sustainable Finance.
About NN Investment Partners
NN Investment Partners is the asset manager of NN Group N.V., a publicly traded company listed on Euronext Amsterdam. NN Investment Partners is head-quartered in The Hague, The Netherlands and manages in aggregate approximately EUR 245 bln* in assets for institutions and individual investors worldwide. NN Investment Partners employs over 1,200 staff and is active in 15 countries across Europe, U.S., Latin America, Asia and Middle East.
*Figures as of 30 June 2017, EUR 51 bln relates to the AuM of Delta Lloyd Asset Management.
FMO is the Dutch development bank. As a leading impact investor FMO supports sustainable private sector growth in developing countries and emerging markets by investing in ambitious projects and entrepreneurs. FMO believes that a strong private sector leads to economic and social development, and has a 45-year proven track record of empowering people to employ their skills and improve their quality of life. FMO focuses on three sectors that have high development impact: financial institutions, energy, and agribusiness, food & water. With a committed portfolio of EUR 9.0 billion spanning over 92 countries, FMO is one of the larger bilateral private sector developments banks globally.