For more information on the financial terms used in this article, please consult the glossary.
What is impact investing?
Impact investing means investing in companies that aim to deliver positive meaningful societal outcomes by addressing the world’s major societal and environmental challenges, while at the same time producing a financial return.
How do impact funds differ from ethical and ESG investing?
Ethical funds
Avoid companies in ‘sin sectors’ such as alcohol, tobacco and pornography - a range that many funds have expanded today to include fossil fuels.
Sustainable funds
Invest in companies across a wide range of industries, giving weight to those that score well on environmental, social and governance issues.
Impact funds
Invest in companies that explicitly aim to have a positive impact on the societal and environmental issues that face the world. Each company must demonstrate a measurable benefit (such as CO2 emissions savings in tonnes).
3 reasons to invest
M&G (Lux) Positive Impact Fund
The aim of the M&G (Lux) Positive Impact Fund is to achieve attractive returns by investing in impactful and sustainable companies. The fund is guided by the UN Sustainable Development Goals (SDGs) and invests in companies that focus on at least one of six key impact areas - three environmental and three social - each based on the UN SDGs.
At least 80% of the fund is invested in the shares of companies, across any sector and of any size, from anywhere in the world, including emerging markets. The fund usually holds shares in fewer than 40 companies. The fund invests in securities that meet its ESG Criteria and Impact Criteria. Norms-, sector- and/or values-based exclusions apply to investments. All companies are assessed on their investment credentials and ability to deliver positive social and/or environmental impact.
The fund manager expects at least 80% of the fund to be invested in sustainable investments (with a minimum 30% in social and 30% in environmental).The fund is actively managed and the benchmark is the MSCI ACWI Net Return Index. The benchmark is not an ESG benchmark and is not consistent with the ESG Criteria and Sustainability Criteria.
The value of a fund's assets will go down as well as up. This will cause the value of your investment to fall as well as rise and you may get back less than you originally invested. Past performance is not a guide to future performance. We are unable to give financial advice. If you are unsure about the suitability of your investment, speak to your financial adviser. The views expressed in this document should not be taken as a recommendation, advice or forecast
Exclusions
Further details about fund’s exclusions approach are described in the ESG Criteria document available here.
Why M&G?
Focus & Transparency
The M&G (Lux) Positive Impact Fund is a liquid, transparent investment product with a sound investment process. It offers broad access to impact investments through listed stocks. The fund typically holds around 40 stocks and reports annually on the impact of these companies.
Dual objective
The fund has a compelling dual objective: first, it aims to deliver a higher total return (capital growth plus income) than the global equity market over any five-year period. Secondly, it invests in companies that address the world's major social and/or environmental challenges, thereby achieving positive impact.
An evolving regulatory environment
Regulators are increasingly focusing on the environmental and social profile of companies, and governments around the world are funding green policy packages. We believe this creates multiple opportunities for companies to provide solutions to the world's biggest challenges.
The M&G (Lux) Positive Impact Fund is a sub-fund of M&G (Lux) Investment Funds 1, an open-ended investment company established in Luxembourg which is available for sale in certain jurisdictions only. M&G (Lux) Investment Funds 1 has appointed M&G Investments (Singapore) Pte. Ltd. as its Singapore representative and agent for service of process.
This document is for informational purposes only and does not constitute an offer or solicitation to purchase or sell units in the fund. Investment involves risk. Past performance is not necessarily a guide to future performance or returns. The value of investments and the income from them can fluctuate and is not guaranteed. Rates of exchange may cause the value of investments to go up or down. Investors may not get back the amount they invest. Subscriptions in the fund are valid only if made on the basis of the current Prospectus and the Product Highlights Sheet available on our website www.mandg.com/investments/sg and you must read these documents before deciding whether to invest. Investors may wish to seek advice from a financial adviser before purchasing shares of the fund. In the event that they choose not to seek independent financial advice, they should consider carefully whether the fund is suitable for them.