Bringing you rewarding opportunities in the ESG space: Rewards Programme Update (May 2021)

1.       ESG Fixed Income Funds (Thematic and Impact Investing)

ESG investing has been gaining traction in recent years, especially with climate change becoming a huge, pressing issue. ESG investing is about investing sustainably in companies, and taking into consideration their Environment, Social and Governance impact before making an investment decision. This means investors will be investing in companies that have taken steps in managing and reducing harm to the environment, ensuring fair, proper dealings with stakeholders, and practice good corporate governance.

Read more on ESG in our “ESG – Latest developments in a rapidly growing investment theme” article.

As mentioned in the article, investors should note that good ESG performance is often associated with good financial standing, hence ESG may be one of the considerations that investors should take note of when deciding on their investments. There are multiple strategies for investors to incorporate ESG selection when making their own investments, one of which is thematic and impact investing, which could focus on a specific Environment, Social or Governance issue.

For Fixed Income investors, good ESG performance could be an important consideration, as poor ESG compliance often leads to regulatory or reputational risk, which could affect the company’s credit and its ability to finance its debt obligations.

We have selected to the FSM Rewards Catalogue two fixed income ESG funds which have adopted the thematic and impact investing approach –  Eastspring Sustainable Asia Bond Fund as well as Manulife Global Fund – Sustainable Asia Bond Fund.

2.       ESG Fixed Income Funds (Positive selection)

Another method of ESG investing is through positive selection. This is done by choosing to invest in companies with a high ESG rating. Compared to thematic and impact investing, this is less focused on a specific E, S or G issue but takes everything into account through their overall ESG ratings. The fixed income ESG funds that invest through positive selection and included in our Rewards Catalogue include JPMorgan Global Bond Opportunities Sustainable Fund, Pinebridge Singapore Bond Fund and Blackrock ESG Emerging Markets Bond A2 USD.

3.       ESG Equity Funds (Thematic and Impact Investing)

As for investors who prefer equity funds over fixed income funds, our Rewards Programme also has something for you! Utilising thematic and impact investing approach, and providing direct exposure to some of the companies environmental factors, these are the newly added ESG equity funds to the FSM Rewards Catalogue: Natixis Mirova Global Sustainable Equity Fund, BNP Paribas Aqua Classic Fund and CPR Invest – Climate Action Fund.

4.       China Funds

Other than ESG related funds, the revamped rewards programme will also bring you new China funds. Investors can look forward to trading their rewards points for JPMorgan Funds – China A (acc) SGD and Allianz China A Shares AT Acc SGD.

Both funds allocate their investments largely to the financial, consumer discretionary, IT and many other similar sectors in China. JPMorgan Funds – China A (acc) SGD invests in many big name companies like Tencent, Alibaba, Meituan and more. Alternatively, if investors are interested in something different with higher holdings in the industrial or consumer staples sector, Allianz China A Shares AR Acc (SGD) has top holdings in Contemporary Amperex Techn-A, Jiansu Hengli Hydraulic C-A and Wuliangye Yibin Co Ltd-A. (As at 28/02/2021)

New fund opportunities in FSM Rewards Catalogue

From 17 May 2021 onwards, investors will be able to use their FSMOne.com rewards points to redeem these following funds:

-          Eastspring Sustainable Asia Bond Fund

-          Manulife Global Fund – Sustainable Asia Bond Fund

-          JPMorgan Global Bond Opportunities Sustainable Fund

-          Pinebridge Singapore Bond Fund

-          Blackrock ESG Emerging Markets Bond A2 USD

-          Natixis Mirova Global Sustainable Equity Fund

-          BNP Paribas Aqua Classic Fund

-          CPR Invest – Climate Action Fund

-          JPMorgan Funds - China A (acc) SGD

-          Allianz China A Shares AT Acc SGD

In addition, these funds, including previously highlighted ESG funds, and a few other Recommended and Choice Awards fund winners from 2020 will continue to be available for redemption from our rewards catalogue:

-          Nikko AM Shenton Global Opportunities SGD

-          Blackrock ESG Multi-Asset A2 USD-H

-          Allianz Global Sustainability CL AM Dis H2-SGD

-          Fidelity Sustainable Strategic Bond A-ACC-USD

-          Schroder Asian Growth DIS SGD

-          Nikko AM Shenton ShortTerm Bond (S$)

-          Allianz Income & Growth H2-SGD

-          UBS (Lux) Equity Fund - Greater China P Acc SGD