The Responsible Horizons EM Debt Impact Fund has a sustainable investment objective as it aims to achieve positive environmental and/or social impacts while generating a total return comprised of income and capital growth by investing in emerging market debt and debt-related securities and related financial derivative instruments.
The value of investments can fall. Investors may not get back the amount invested. Income from investments may vary and is not guaranteed.
For a full list of risks applicable to this fund, please refer to the Prospectus or other offering documents.
There is no guarantee that the Fund will achieve its objectives.
The Fund follows an ESG investment approach. This means factors other than financial performance are considered as part of the investment process. This carries the risk that the Fund’s performance may be negatively impacted due to restrictions placed on its exposure to certain sectors or types of investments. The approach taken may not reflect the opinions of any particular investor. In addition, in following an ESG investment approach, the Fund is dependent upon information and data from third parties (which may include providers for research reports, screenings, ratings and/or analysis such as index providers and consultants). Such information or data may be incomplete, inaccurate or inconsistent.
Why invest in the Fund?
Experienced: Insight1 has a long-established focus on responsible investment, with environmental, social and governance (ESG) factors having been integrated into the investment process and credit analysis for many years.
A strong foundation of expertise, Insights’ emerging markets strategy was established in 2012 and the impact strategy in 2021. The Responsible Horizons EM Debt Impact Fund aims to take an active, value driven approach to impact investing.
Active: The Fund takes a “best ideas” approach, pursuing total return and positive impact in a single fund.
Diversified: A broad opportunity set diversified across issuer, sector, geography and impact type, far broader than traditional green bond indexes. The fund seeks to identify opportunities to support transition and drive change.
Powered by Prime
Prime is Insight Investment’s proprietary environmental, social and governance (ESG) rating system, which uses extensive global data and in-depth analysis to highlight key ESG risks.
The Fund’s portfolio managers and analysts use Prime corporate ESG and climate risk ratings to support their investment decisions, inform any engagement they may undertake with companies, and to build portfolios with sustainability goals.The ratings generated by Prime will help to guide the Fund’s investments in line with its stated ESG criteria, with ratings defining whether companies are best-in-class or worst-in-class, and indicating deterioration or improvement with regard to ESG issues.
Broad investment universe
- The Fund will target a minimum of 50% in impact bonds: Green, Social and Sustainability plus up to 50% in impact or improving issuers (SDG or EU taxonomy).
Seeking a positive impact
- The Fund screens emerging market debt (EMD) issuers using ESG criteria, a thematic approach then identifies those securities and issuers who it expects to have a positive incremental impact to people, the planet and prosperity and aims to offer attractive financial returns.
- The Fund positively allocates towards higher scoring, best in universe, securities and issuers.
Supporting transition
- As well as investing at least 50% in impact bonds, within the investment process, the manager may also seek out opportunities to engage and support impact issuers whose majority revenue streams or economic activities, and improving issuers whose majority core investment plans, are compliant with EU Taxonomy Regulation. Improving issuers shall be engaged in EU Taxonomy Regulation Transitional Activities.
Governance
Corporate governance assessment is key in forming part of the ESG risk rating for all issuers and includes evaluating:
- board practices and behaviour
- remuneration
- control and accountability
- ethics or controversies.
The Investment Manager applies knowledge of the issuers’ governance together with ESG ratings to set priorities where it decides engagement may be appropriate.
Meet the team
The Fund draws on expertise from Insight's emerging market, credit research, and responsible investment teams. The teams seek to identify relevant and material ESG risks, looking beyond just green bonds, seeking to offer access to the entire impact opportunity set in public fixed income.
Simon Cooke, CFA*
Portfolio Manager
*CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.
For a full list of risks applicable to this fund, please refer to the Prospectus or other offering documents. Please refer to the prospectus, and the KIID before making any investment decisions. Documents are available in English and an official language of the jurisdictions in which the Fund is registered for public sale. Go to fund-centre.
Benchmark: The Fund will measure its performance against the JP Morgan EM Green, Social and Sustainable Bond Index Diversified, (the “Benchmark”) for comparison purposes. However, the Investment Manager does not seek to align the Fund’s performance with that of the Benchmark and the performance of the Fund and the Benchmark may differ significantly.
The Fund is actively managed, which means the Investment Manager has discretion to invest outside the Benchmark subject to the investment objective and policy. The Fund has an unconstrained investment style, and as such it will not take the Benchmark into account when selecting the Fund’s Investments.
Insight Investment uses impact bonds as an umbrella term for fixed income issuances the proceeds of which are dedicated solely to projects intended to meet environmental or social criteria. This encompasses the universe of bonds referred to as green or sustainable as well as more specific outcome-oriented issuances such as blue, gender and transition bonds.
Important information
1 Investment Managers are appointed by BNY Mellon Investment Management EMEA Limited (BNYMIM EMEA), BNY Mellon Fund Managers Limited (BNYMFM), BNY Mellon Fund Management (Luxembourg) S.A. (BNY MFML) or affiliated fund operating companies to undertake portfolio management activities in relation to contracts for products and services entered into by clients with BNYMIM EMEA, BNY MFML or the BNY Mellon funds.
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