Franklin Templeton launches social bond fund

Addressing the 'increasing interest' in the S of ESG

Franklin Templeton has added a social bond fund to its Investment Funds range.

The Franklin European Social Leaders Bond Fund looks for bonds – primarily Euro-denominated investment grade bonds worldwide – financing projects such as affordable housing, employment generation, food security, socioeconomic advancement and access to essential services.

The fund will be co-managed by London-based David Zahn, senior vice-president and head of European fixed income for Franklin Templeton Fixed Income – Global Sovereign and Emerging Market Debt, and Roderick MacPhee, vice-president, portfolio manager and research analyst for Franklin Templeton Fixed Income.

Zahn said: “Given recent events and the growing emphasis on environmental aspects of sustainable investing, investors are increasingly interested in addressing the S in ESG.

“A portfolio of actively-managed social bonds can provide an attractive source of risk-adjusted returns while providing liquidity to new and existing projects contributing to positive social outcomes. This new fund also benefits from transparency in quantifiable reporting on social impact of fixed income investments.”

The sub-fund of the Luxembourg-domiciled Franklin Templeton Investment Funds range will be registered in almost 20 European countries, including Germany, France, Italy, Spain, Switzerland and the UK.