AMP Capital Responsible Investment Leaders Diversified Fixed Income Fund

Product Name

AMP Capital Responsible Investment Leaders Diversified Fixed Income Fund

Issuer

AMP Capital

Category

Investment product

Type

Fund/Trust

Target

Wholesale

Certified Since

2005

Certification Symbol

Responsible Investment

Asset Classes

Fixed income

Markets

Australia

Investment Approaches

Negative Screening, ESG Integration, Engagement

It Includes

  • Riaa icons 11 More sustainable companies

It Excludes

  • Riaa icons 33 Fossil fuels
  • Riaa icons 34 Logging
  • Riaa icons 35 Tobacco
  • Riaa icons 50 Nuclear energy (including uranium)
  • Riaa icons 52 Human rights violations
  • Riaa icons 38 Labour rights violations
  • Riaa icons 56 Animal cruelty
  • Riaa icons 36 Armaments
  • Riaa icons 41 Alcohol
  • Riaa icons 42 Gambling
  • Riaa icons 55 Pornography
  • Riaa icons 45 Genetic engineering

Overview

Offers investors access to a diversified portfolio of Australian fixed income securities, global government bonds and global credit securities. The investment objective is to provide a total return (income and capital growth) after costs and before tax, above the fund’s performance benchmark on a rolling three-year basis. The responsible investment framework for the fund is outlined in the RIL fund’s Ethics Charter, which provides the minimum environmental, social and governance requirements for the underlying managers. The RIL Ethics Charter requires the underlying managers to: a) not invest in securities associated with companies that have a material involvement (10% of revenue) in: gambling, alcohol, tobacco, pornography, uranium (and nuclear power) and armaments; b) not invest in securities associated with companies that have a material involvement (20% of company value) in: thermal coal mining; brown coal power generation; oil sands; transport infrastructure associated with oil sands; and coal to oil to gas processes. c) not invest in the poorer performing ESG securities in all sectors or companies explicitly identified by AMP Capital's Ethics Committee; and d) sovereign bonds issues by poor ESG performing countries


Description


As described above, Responsible Investment Leaders (RIL) I Ethics Charter applies also to this product, especially as this relates to corporate bonds. ESG criteria are applied in the management of the RIL Balanced Fund’s government bond portfolios.

AMP Capital’s ESG research team, led by Dr Ian Woods, provides a list of governments to be excluded from the benchmark based on a detailed assessment of how well countries are addressing the various ESG risks they face. This covers 70 of the most commonly-invested government bonds, including all OECD countries and key emerging market economies. ESG criteria are applied in the management of the RIL Balanced Fund’s government bond portfolios.

The RIL Balanced Fund’s sovereign bond managers avoids the countries that rank in the bottom quartile of the rankings. The principal sovereign risks considered by the ESG research team are associated with governance, corruption and rule of law. The ESG research team is increasingly focusing on key socio-economic criteria that they believe are not well captured in standard credit ratings of sovereigns.

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