Columbia Threadneedle upgrades two funds to Article 9 and eight funds to Article 8; announces changes to SICAV fund names

21 November 2023

Columbia Threadneedle Investments (Columbia Threadneedle), a leading global asset management group, is upgrading two funds to Article 9 and eight funds to Article 8 in its Luxembourg-SICAV range of funds. Following the reclassification, effective today, Columbia Threadneedle’s offering will include 24 Article 8 funds and four Article 9 funds, with 84% of AUM in the SICAV classified as either Article 8 or Article 9 financial products. In addition, Columbia Threadneedle will consider the principle adverse impacts (PAIs) of its investment decisions that may negatively harm sustainability factors through a combination of exclusions, investment research and monitoring and engaging with investee companies.

The two funds being reclassified as Article 9 are:

CT (Lux) European Social Bond

The CT (Lux) European Social Bond fund is actively managed and seeks to achieve a total return from income and capital appreciation by investing in debt securities that are considered to provide positive social outcomes by supporting or funding socially beneficial activities and development principally in Europe. Managed by Tammie Tang, the fund was launched in 2017 with the aim to use the power of the bond market to deliver positive impact for society without sacrificing financial returns. To achieve the social objective, the investment process follows a clear process:

1. Creating the social universe of investments by identifying categories of bonds with higher potential for delivering one of seven areas of social outcome (such as affordable housing, health and welfare, economic regeneration and development) while excluding those with negative social characteristics.
2. Adhering to particular social norms to ensure that no bond held violates set standards.
3. A focus on positive inclusion by carrying out a detailed assessment of the bond’s contribution to positive social outcomes.
4. Ongoing governance, monitoring, engagement and reporting to maintain and enhance the fund’s social focus and standards

INCO (http://inco-group.co), an organisation specialising in impact investment, provides assistance in assessing and reporting each year on the social outcomes of the fund and providing research on trends and practices relevant to impact investment.

CT (Lux) Sustainable Outcomes Global Equity

Launched in 2021 and managed by Pauline Grange, the CT (Lux) Sustainable Outcomes Global Equity fund aims to generate capital growth by investing in equity securities of companies globally that are delivering positive sustainable outcomes for the environment and/or society through their products and services, and display strong environmental, social and governance (ESG) practices in line with one or more of the fund’s eight environmental or social themes, as set out below:

• Good health and well-being;
• Reduced inequalities;
• Decent work and economic growth;
• Sustainable cities and communities;
• Quality education;
• Affordable and clean energy;
• Industry, innovation and infrastructure; and
• Responsible consumption and production.

The funds will continue to invest in sustainable investments. However, the investment policy and SFDR RTS Annex will be amended to commit explicitly the funds to invest at least 80% of their total assets in sustainable investments within the meaning of Article 2(17) of SFDR and will be classified under Article 9 of SFDR.

Fund names changing

Effective today, the individual fund names of ‘Threadneedle (Lux)’ and ‘Columbia Threadneedle (Lux)’ will be renamed and will use the prefix ‘CT (Lux)’. The changes are intended to better reflect the Columbia Threadneedle branding and provide consistency with its other fund ranges. This follows the large rebranding exercise that was undertaken last year across various ranges following the acquisition of BMO’s EMEA asset management business.

Florian Uleer, Head of EMEA Wholesale at Columbia Threadneedle, said: “We’re excited to bring all our products under a simplified name for the benefit of our clients and distributors and are proud of the broad offering we have built over the years as we continue to meet the evolving needs of our clients.

We know that how we invest and what we invest in is as important as the financial returns we generate for our clients. For that reason, we have been developing our fund range to meet the sustainability requirements of our clients since we launched the first ethical fund in Europe, in 1987. Since the introduction of the EU Sustainable Finance Disclosure Regulation (SFDR) in 2021, our priority has been to build on our responsible investment capabilities, while adapting our product range to the new rules. We are pleased to add eight funds to Article 8 and two funds to Article 9 to our existing offering with over 80% of our AUM in our Luxembourg SICAV range now classified as either Article 8 or 9 funds. We believe this creates more choice of investments for our clients”.

Source: Columbia Threadneedle