Three funds to drive positive change for the environment – and next generations

09 November 2022

3 minute read

Here are three funds supporting a cleaner environment.

Who's it for? All investors

The value of investments can fall as well as rise and you could get back less than you invest. If you’re not sure about investing, seek professional independent advice.

The ethos of sustainable and responsible investing is catching up with the way many people already buy clothes, cars and even groceries. Investors want to see that same thinking in the way they invest their pensions and ISAs.

A new study by Barclays Wealth shows that becoming a parent is often the trigger for many investors to start placing their money into more ethical choices.

The majority (55%) of parents who invest for their family’s future favour investments which adhere to responsible standards when it comes to the environment, society and governance – that is, well-run companies – known as ESG investing.

The study revealed that it’s mothers who are more likely to consider sustainable investment options for their family (62%), whereas fathers place less value on investing sustainably (50%). When asked which sectors they considered when investing for their family’s future, sustainable energy (31%) came out on top.

Investors can access this theme through investment funds, rather than selecting the individual companies in which to invest.

Here are three funds you might like to consider if the environment is top of your agenda:

BlackRock Sustainable Energy Fund

The aim of the fund is to invest in companies that are engaged in alternative energy and energy technologies. This includes areas such as alternative fuels, energy efficiency, and renewable energy technology, while avoiding areas such as oil and gas exploration/production and coal.

The fund is managed by a well-resourced and experienced team with one of the longest track records investing in the new and sustainable energy theme. While we’ve seen many similar new funds launched over the last few years, as new teams enter this space, we place great emphasis on the well-resourced and experienced investment team dedicated entirely to idea generation for this fund.

Jupiter Ecology Fund

As one of the longest-running environmentally-focused investment funds, the Jupiter Ecology Fund was launched in 1988, when a focus on such areas was seen as very specialised and somewhat ‘unusual’. The fund’s investment approach has remained the same since day one – to identify long-term investment opportunities in companies that provide solutions to our environmental challenges.

This fund invests across environmental themes that include renewable energy, pollution reduction, resource efficiency, water treatment and infrastructure, and waste recycling, as well as social themes such as access to healthcare and education.

Janus Henderson Global Sustainable Equity Fund

What makes this fund stand out is the robust process which determines which companies can and can’t make it into the portfolio. For every company they invest in, they ask themselves one simple question, “is the world a better place because of this company?”

And how can they prove this? Every year, the manager publishes a report called the ‘Annual Sustainability Report’, which details the impact the fund has had, including statistics such as the amount of renewable energy generated, the amount of CO2 emissions avoided, and the number of patients receiving healthcare, for every £1 invested. It really does show you how your investment has made a difference.

Finding the right investment for you

These three funds all feature on the Barclays Fund List. It’s made up of a number of funds from each of the investment sectors we believe are key for building a diversified portfolio.

As well as the three funds featured here, the Funds list also includes broader ESG funds that look to cover a wider range of issues, such as the Stewart Investors Asia Pacific Leaders Sustainability Fund and Threadneedle UK Social Bond Fund.

By reading about the funds available you can choose investments based on personal values and preferences.

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The value of investments can fall as well as rise. You may get back less than you invest. Tax rules can change and their effects on you will depend on your individual circumstances.

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