The fund joins Calvert Investments’ family of SRI funds called Calvert Solution Strategies, and is sub-advised by London’s Hermes Investment Management Limited.
Using an SRI screen for sustainability and corporate responsibility, the fund invests in companies in emerging markets that are sensitive to environmental, social and governance concerns. While the fund is free to invest in companies of any market capitalization, it will strive to invest in companies with market capitalization characteristics similar to the MSCI Emerging Markets Index.
“We see a growing opportunity in emerging markets,” said Natalie Trunow, chief investment officer, equities, Calvert Investment Management. “Emerging markets remain the fastest growing segment of the global economy, responsible for 85% of all global growth since the beginning of 2008. While the pace has slowed, the estimated ranges of growth rates are still significantly greater than the estimated range of GDP growth rates in developed countries.”
With emerging markets undergoing rapid social, political and economic developments, this is creating inefficiencies in investing in emerging markets, added Gary Greenberg, lead portfolio manager and head of Hermes Emerging Markets. “The volatility caused by these changes means that, at times, quality companies in countries with conditions that are supportive to growth will trade at very attractive valuations, allowing us to profit from temporary bouts of adverse market sentiment,” Greenberg said.