Columbia Threadneedle Investments has launched the CT Net Zero Transition Buy and Maintain Fund Range, a suite of four funds focused on sustainable investment-grade corporate bonds with a net-zero commitment.
The fund range provides an actively managed buy-and-maintain credit strategy aimed at delivering “stable cash flows and strong long-term returns from investment grade corporate bonds” while reducing portfolio emissions in alignment with global net-zero goals”.
The range includes three sterling-denominated funds with bond maturities staggered between 2024 and 2046, allowing investors flexibility to match liability profiles and minimise transaction costs. Additionally, a fourth euro-denominated fund will maintain a constant duration of around seven years. All funds in the range incorporate core ESG objectives aligned with Article 8 under the Sustainable Finance Disclosure Regulation (SFDR).
The asset manager’s bottom-up investment approach, supported by issuer research, underpins the fund strategy. An approach focused on how company fundamentals might change over the medium term allows it to take a long-term view in line with pension fund objectives.
Rebecca Seabrook, Fixed Income Portfolio Manager at Columbia Threadneedle, emphasized the importance of active credit management within the funds: “Our experienced team of in-house credit analysts allow us to be proactive when an investment view changes, particularly when identifying names on a longer-term positive credit trajectory. The ‘maintain’ element is the crucial part.”
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The CT Net Zero Transition Buy and Maintain Fund Range offers a well-diversified portfolio with a strong focus on downside risk management to ensure consistent cash flows. The initiative reflects Columbia Threadneedle’s commitment to responsible investment, targeting a reduction in the portfolio’s carbon footprint as invested companies work to cut emissions.
Greg Skinner, head of UK institutional and insurance at Columbia Threadneedle, highlighted the relevance of the fund range in the current market context: “Higher interest rates mean that many defined benefit pension schemes are in a stronger funding position than they were a few years ago, prompting them to explore de-risking strategies. With a primary focus on helping our pension fund clients meet their liability matching needs, our Buy and Maintain Fund Range is well-placed to support our clients achieve that vision and create greater certainty of future cashflows.”
Skinner also emphasised Columbia Threadneedle’s leadership in responsible investment, stating: “As pioneers and leaders in responsible investment, we are passionate about helping clients understand and manage their ESG risks. We are excited to provide our clients with a cost-effective solution for accessing credit markets within the Article 8 and net-zero frameworks.”
