PGIM Investments launches ESG multi-sector fixed income fund
PGIM Investments is expanding its commitment to environmental, social and governance (ESG) investing with the launch of the PGIM ESG Total Return Bond Fund, its first dedicated ESG strategy offered to US investors.
The new fund is an alternative but complementary offering to PGIM’s USD60 billion PGIM Total Return Bond Fund.
PGIM is the USD1.5 trillion global investment management business of Prudential Financial, Inc.
The fund seeks total return by investing in a diversified portfolio of bonds across multiple fixed income sectors, emphasising issuers with stronger ESG characteristics and practices than traditional intermediate core-plus bond portfolios.
The fund is managed by an experienced team of PGIM Fixed Income portfolio managers including Gregory Peters, Robert Tipp, Michael Collins, Richard Piccirillo, and Lindsay Rosner, averaging 27 years’ investment experience.
PGIM Fixed Income’s methodology begins with an exclusionary screen and then utilises a proprietary scoring methodology to assign ESG impact ratings and construct the fund’s portfolio. These ESG ratings are assigned by a team of more than 110 analysts and overseen by PGIM Fixed Income’s ESG committee. Under normal circumstances, the fund will not purchase securities of issuers that have ESG impact ratings below an established threshold.
“As one of the largest fixed income fund providers, we recognise the increased demand from clients for optionality between traditional and ESG investment strategies,” says Stuart Parker, president and CEO of PGIM Investments. “With this launch, we are pleased to offer our clients the ability to express their values and beliefs through their investments, while continuing to deliver on the rigorous investment standards PGIM Fixed Income is known for.”
Greg Peters, head of Multi-Sector and Strategy, PGIM Fixed Income, adds: “Our relative value analysis incorporates credit material ESG factors to help identify risks and opportunities. Taking that analysis a step further in the PGIM ESG Total Return Bond Fund, our ESG Impact ratings allow us to construct a portfolio with the dual objective of maximising return while also accounting for the positive or negative potential outcomes of our investments on the environment and society.”