Strong global growth in Green Bond portfolios: NN IP manages the world’s largest Green Bond fund

09/07/2018

In the second quarter of 2018, NN Investment Partners (NN IP) saw a significant increase in the management of green bond portfolios. Assets under management increased from EUR 20 million in 2016 to approximately EUR 900 million in July 2018 and is expected to grow rapidly to over EUR 1 billion.

The NN (L) Euro Green Bond fund has been the best performing Green Bond fund over the past years and has grown into the world’s largest Green Bond Fund with EUR 560 million in assets under management. This is due to the global growth of the green bonds market and the increasing demand from retail and institutional investors for sustainable and environmentally friendly investments, without sacrificing returns.

Since the 2014 publication of the first Green Bond Principles, the market for green bonds has grown rapidly. Green bonds are fixed income instruments where the proceeds are used to partly or fully (re)finance new and/or existing projects that have proven beneficial to the environment. The green bond market has grown to more than EUR 300 billion. NN IP has a 20-year track record in the field of responsible and sustainable investing and has been an active signatory of the Principles for Responsible Investment (PRI) since 2008. With the launch of the NN (L) Euro Green Bond fund, NN IP stood at the cradle of the fast growing global green bond market in 2016.

As a pioneer in green bonds, NN IP has been focussing on so-called ‘dark green bonds’ since 2014 and assesses green bond issues itself. By means of this extra step, NN IP ensures the green character of the investment by making its own independent selection based on its green bond framework. In addition, NN IP offers its clients comprehensive impact reporting that effectively shows how the green character makes a difference, e.g. the impact of the investments on the amount of CO2 emissions. The fund is also the first Green Bond fund to receive both the LuxFLAG Climate Finance Label and the French TEEC Label. This provides independent assurance that the investments effectively contribute to the financing of climate change initiatives and emphasizes the dark green and rigorous approach of the fund in selecting green bonds.

Bram Bos, Lead Portfolio Manager Green Bonds at NN Investment Partners, comments: “The fact that the NN (L) Euro Green Bond fund was awarded the French TEEC Label earlier this year, combined with the significant growth in assets under management, represents a growing recognition of the quality of the Fund. In addition to the dark green profile, the fund has been the best performing Green Bond fund in recent years, both in terms of relative and absolute performance. Our clients indicate that green bonds play an increasingly prominent role in portfolios and welcome the rapid growth of the green bond market. Issuers recognise our strong position in green bonds. This allows us to influence new green bond placements and owing to our size, we are a welcome participant in new green bonds issues.”

NN (L) Euro Green Bond fund is a sub-fund of NN (L) (SICAV)*, established in Luxembourg. NN (L) (SICAV) is duly authorised by the Commission de Surveillance du Secteur Financier (CSSF) in Luxembourg. Selected share classes of the sub-fund are currently registered in Luxembourg, The Netherlands, Belgium, France, Sweden, Denmark, Finland, Switzerland, Spain, Italy and Austria.

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About the author

Bram Bos

Bram Bos

Senior Portfolio Manager

Experience since 2001

Business Experience

2016-to-date Bram is Senior Portfolio Manager in the Euro Investment Grade Credit team within the Global Credit Boutique of NN Investment Partners. He is Co-Lead Portfolio Manager for the Green Bonds strategy and Senior portfolio Manager for the Euro Investment Grade Credit strategy and the Euro Sustainable Credit strategy and for all  SSAs within the Euro Investment Grade Credit strategies.

2015-2016 Senior Portfolio Manager Government & Government (Related) Debt at NN IP 

2011-2015 Senior Portfolio Manager Fixed Income at Univest Company

2010-2011 Executive Director at Nomura Singapore

2009-2010 Senior Portfolio Manager at APG

2005-2009 Portfolio Manager Currency & Strategy at Fullerton Fund Management

2001-2005 Portfolio Manager Currency at ABP

Member of UN PRI Fixed Income Steering Committee 2014 - to date

Set-up and management of ESG credit and ESG government bond portfolio 2011-2015

Integration ESG in fixed income portfolios

Management and selection of Green Bonds

Qualifications

FBA

MSc in Economics from the Erasmus University in Rotterdam in 2001

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