The addition of these five investment products brings the number of labelled investment and insurance products to 326, with €166bn of assets under management in Q2 2023, said a .
Two of the newly labelled investment products are Protea Fund--Orcadia Global Sustainable Dynamic (Fund Partner Solutions) and Tyrus Capital Investments--Tyrus Capital Global Convertible Fund (Lemanik Asset Management). Both of the funds received an ESG label and are classified as article 8 under the EU’s Sustainable Finance Disclosure Regulation. This classification means the fund promotes environmental and/or social characteristics (as opposed to article 9 funds, which have a sustainable investment objective).
Luxflag’s ESG label aims to reassure investors that the investment product incorporates ESG criteria throughout its investment process and screens 100% of its invested portfolio according to a recognised ESG strategy or standard.
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Three funds were granted the use of the Luxflag Applicant Fund Status, added the agency. They are: Federal Finance Gestion’s Autofocus Transition Climat Juillet 2023 (AFS/ESG, article 8), Federal Finance Gestion’s Federal Premium Horizon 2026 (AFS/ESG, article 8), and Chenavari Asset Management’s Chenavari Real Estate Decarbonisation Fund (AFS/ESG, article 8).
What is a Luxflag label?
A Luxflag label is an independent, internationally recognised validation of compliance that can be used by asset managers to highlight the sustainability, ESG or impact credentials of investment products, .
Impact labels can be given to microfinance investment vehicles in the microfinance sector, to investment products in the environment and climate finance sectors, or to green bonds, while transition labels fall into three categories--ESG, ESG insurance product and ESG discretionary mandate. A climate finance label, for instance is meant to reassure investors that an investment product invests at least 75% of its total assets in investments related to mitigating or adapting climate change.
Luxflag-labelled investment and insurance products are domiciled in 11 jurisdictions, noted the press release: Belgium, Denmark, Estonia, France, Finland, Germany, Ireland, Luxembourg, Monaco, Spain and Switzerland.
Labels are valid for 12 months and can be renewed by submitting an updated application document.