Nordea AM fund alters diversity focus and downgrades to Article 8

Comes as firm announces its participation as a co-founder in the Diversity Project Europe

Nordea Asset Management has renamed and broadened the scope of its Nordea 1 Global Gender Diversity fund to expand its investment universe and focus on engagement. 

The global equity fund is now called the Nordea 1 Global Diversity Engagement fund.

By extending the fund’s investable universe to include additional diversity and inclusion (D&I) factors, Nordea aims to capture a broader range of companies in the early stages of D&I development.

As a result of the wider investment universe and increased focus on engagement, Nordea 1 Global Diversity Engagement fund will be reclassified as an Article 8 product.

The fund has environmental and/or social characteristics but does not have sustainable investment as its objective.

According to Nordea this ensures no candidates for positive corporate change are excluded from consideration. 

Nordea added it remains committed to maintaining a minimum proportion of 50% in sustainable investments.

Portfolio managers Julie Bech and Audhild Aabø will continue to manage the expanded portfolio. 

They will adopt the same investment process, but engagement with investee companies is now a core component of the strategy.

The managers will draw upon the engagement expertise of Nordea’s Responsible Investment (RI) team, which in 2022 conducted nearly 1,000 engagement actions around the world.

Co-manager Bech said: “Expanding the investment focus of this fund gives us a broader scope, which translates into broader impact. The refocusing also allows us to place a stronger emphasis on engagement in order to drive both alpha and social change.”

The Nordea 1 fund changes come as Nordea announces its participation as a co-founder in the Diversity Project Europe (DPE), a cross-border and cross-company initiative aiming to pave the way towards a more inclusive asset management industry across Europe.

Societal demands for change in relation to improving D&I continue to evolve beyond just gender representation. In addition, diversity data disclosure is continually progressing and revealing the wider complexity of D&I issues.

Helping companies accelerate the adoption of positive D&I practices can unlock long-term value, the managers believe, as the market is increasingly likely to reward companies displaying sound ESG practices.