Schroders is today announcing the launch of the Sustainable Multi-Factor Equity (SMFE) fund, a global equity strategy that integrates environmental, social and governance (ESG) analysis into a systematic investment approach. The cost-effective SMFE fund will aim to outperform the MSCI All Country World Index, while savers will also benefit from Schroders’ sophisticated approach to investing sustainably.
The fund will particularly appeal to UK Defined Contribution (DC) schemes, as it provides a distinctive solution that meets members’ growing demand to invest their pension savings more sustainably.
Tim Horne, head of UK Institutional DC, Schroders, said in a statement: “DC pensions are increasingly looking at how best to incorporate sustainability into their schemes in response to investor demand and regulatory change. However, until now, this has been a challenge for DC schemes as the charge cap means many actively-managed strategies are out of reach for most schemes. Existing low-cost options also tend to offer a limited approach to sustainable investing.
The core of the SMFE fund is Schroders’ new proprietary framework, SustainEx, which measures the positive and negative ESG impacts companies place on society and the environment. Ashley Lester, head of Multi-Asset Research and Systematic Investments at Schroders, said in a statement: “SMFE combines a scientific approach to ESG measurement with an equally scientific approach to factor investing.