AXA Investment Managers has launched a fund to help UK insurers make positive contributions to the environment and society by investing in companies with the potential to grow while addressing some of the world’s most urgent problems.

According to AXA IM, the People & Planet equity fund supports three sustainable growth themes that align with the UN Sustainable Development Goals: social progress, energy transition and biodiversity. 

“These are not new to AXA,” said Tim Banks, sales director for UK institutional core clients at the firm, in an interview with mallowstreet. 

“These are pre-standing, thematic equity strategies. What we found is that investors want to bring those together and we are giving them access to investment in those companies in a very simplified and cost-efficient form, hence the launch of the fund. It is a great way to access those three themes under the one banner.”

Workplace pension provider Smart Pension is the first institutional investor to indicate its commitment to the new fund, but Banks said the UK-domiciled fund is also suitable for insurers with savings platforms. 

“We see it very much being used in terms of policyholder savings rather than shareholder assets. That doesn't mean when it cannot be used for shareholder assets,” he explained. 

“Certainly, there are a number of insurers out there who do have an allocation to equities and if they are looking for a global equity fund that can demonstrate that the holdings have a positive contribution to the environment and social progress, then this would be a good way of demonstrating our commitment.”

The open-ended is suitable for UK insurers, but Banks said AXA will be launching other versions in other currencies “as we go forward”.

Banks concluded: “If we can find those companies that are either contributing positively to the environment, or making people's lives better, those are the companies that over the long run are going to grow their earnings the quickest and with the best returns. Bringing these three things together from that perspective is really powerful from an ESG point of view but also from a return perspective as well.”