Federated Investors Hermes Investment Management and UBS have announced the launch of the SDG Engagement High Yield Credit funds.

The funds will seek to achieve a meaningful social and/or environmental impact by investing in high yield bonds and engaging with their issuers. The funds will have a lead engager dedicated to driving positive change in line with the UN SDG framework.

A UCITS fund, managed by Hermes, will be offered to investors across the globe, a mutual fund will be available in the US that will be advised by Federated Investment Management Company, and UBS will make the funds available through the UBS platform to clients

The funds will form part of UBS’s $5bn commitment to SDG-related impact investing, and represent the first new strategy added to UBS’s 100 per cent sustainable multi-asset portfolio since its launch last year.

In addition to diversifying clients’ sustainable and impact investments, the new SDG Engagement High Yield Credit funds aim to support key sustainability initiatives spanning the financial services industry. These include the UN-backed Principles for Responsible Investment, which has called for fund managers to engage more effectively with bond issuers, and the IFC’s Operating Principles for Impact Management, a new set of global impact investing standards which UBS shaped and signed alongside roughly 60 other companies earlier this year.

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