AIA-JF launches Hong KongÆs first ever MPF Green Fund

Global equities fund for global environmental problem.
AIA-JF, the MPF-focused joint-venture set up by Hong Kong's largest insurer with JF Asset Management, is to launch the region's first ever "Green Fund" in an attempt to cash-in on growing demand from investors for socially responsible investment (SRI) choices.

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.
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