Investment manager Ninety One has announced its Emerging Market Transition Debt (EMTD) strategy, which is set to be introduced in early 2024.
This innovative approach aims to catalyse investment into the energy transition of emerging markets.
The strategy will provide commercial financing to high-emitting companies in these markets with a strong potential for reducing carbon emissions.
In implementing this strategy, Ninety One will collaborate with various companies across emerging markets to support their transition activities.
Developed in collaboration with entities like Cambridge Associates and Wiltshire Pension Fund, the EMTD strategy seeks to balance the energy transition with risk-adjusted returns for investors.
Matt Christ, portfolio manager for EMTD, said, “Working closely with our foundational partners, we have purpose-built this strategy not only to maximize real-world impact but also to deliver commercially attractive risk-adjusted returns […] EMTD is proof-positive that investors shouldn’t have to sacrifice return for impact.”
Nazmeera Moola, chief sustainability officer, also said, “A successful global energy transition is not possible without a successful emerging markets transition. This is the only way we will collectively achieve net zero. Specifically, we believe there is an opportunity to support and grow the corporate sector by using debt to finance the climate-oriented evolution of their businesses. This provides competitive returns with substantial climate impact.”
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