ESG and Sustainable Investing range
(EU Sustainable Finance Disclosures Regulation - Article 8¹ and Article 9²)
For more information on how we assess, measure and monitor the environmental and social characteristics or the impact of sustainable investments in our products please, refer to our ‘Responsible Investment Policy’ and ‘Implementation Procedures’. For our overall sustainability disclosure policy, and other policies related to sustainable investments, please refer to ‘Policies and Disclosures’.
Mutual funds
You can find the full list of HSBC Asset Management’s mutual sustainable investment funds and their associated disclosures in our Fund Centre.
HSBC Global RAIF
Global Emerging Markets Corporate Sustainable Bond Portfolio
Effective date: 14 July 2025
Summary
No significant harm to the sustainable investment objective
This financial product promotes environmental or social characteristics but does not have as its objective sustainable investment.
The sustainable investments in the sub-fund will be assessed against the principle of DNSH to ensure that the investments do not significantly harm any environmental or social objectives. The DNSH principle applies only to the underlying sustainable investments of the sub-fund. This principle is incorporated into the investment decision-making process, which includes assessment of principal adverse impacts (“PAIs”).
The mandatory PAIs as defined in Table 1 of Annex 1 of the regulatory technical standards for Regulation 2019/2088 are used to assess whether the sustainable investments of the sub-fund are significantly harming the environmental or social objective.
To support the DNSH assessment, quantitative criteria have been established across the PAIs.
The Investment Adviser uses a third-party research provider to monitor companies/issuers for controversies which may indicate potential breaches of the UNGC principles. The principles are aligned with the UN Guiding Principles on Business and Human Rights and the OECD’s Guiding Principles on Business and Human Rights. UNGC principles include the assessment of non-financial risks such as human rights, labour, environment, and anti-corruption. Companies/issuers that are flagged for potential violation of UNGC principles are systematically excluded, unless they have gone through an ESG due diligence assessment, undertaken by HSBC, and are determined not to be in breach of the principles.
HSBC Asset Management is also a signatory of the UN Principles of Responsible Investment.
You can find HSBC Asset Management's Responsible Investment Policy and Responsible Investing Methodologies (including HSBC Asset Management’s proprietary climate transition assessment that supports economies transition towards Net Zero) on HSBC Asset Management’s website: www.assetmanagement.hsbc.com. You will need to select “About us” from the main menu, then “Responsible investing”, then “Policies and Disclosures”.
Sustainable investment objective of the financial product
The Sub-Fund aims to make a positive environmental, social and governance (“ESG”) effect, by investing in fixed income (e.g. bonds) and other similar securities issued by companies/issuers that contribute to United Nations Sustainable Development Goals (“Contributing Companies/Issuers” and “SDGs”), while also aiming to provide long term total return.
The Sub-Fund meets the requirements to be classified as Article 9 of SFDR.
The sustainable investment objectives promoted by this sub-fund are:
- Investment in a portfolio of fixed income securities issued by Contributing Companies/Issuers that actively contribute to the SDGs including, but not limited to, those relating to Climate Action, Affordable and Clean Energy, Clean Water and Sanitation, Good Health and Well Being and Reduced Inequalities
- Consideration of lower carbon intensity investments compared to the JP Morgan Corporate EMBI Broad Diversified the (“Parent Benchmark”)
- Consideration of responsible business practices in accordance with United Nations Global Compact (“UNGC”) and OECD Guidelines for Multinational Enterprises (“OECD”) principles. Where instances of potential violations of UNGC principles are identified, companies/issuers will be subject to the Portfolio Manager’s proprietary ESG due diligence checks to determine their suitability for inclusion in the Sub-Fund’s portfolio and, if deemed unsuitable, excluded
- Exclude activities covered by HSBC Asset Management’s Responsible Investment Policies (the “HSBC Excluded Activities”), the Paris-aligned Benchmark exclusions (the “PAB Excluded Activities”) and further specific Sub-Fund exclusions (together referred as the “Excluded Activities”)
Investment strategy
The Sub-Fund invests, in normal market conditions, a minimum of 90% of its net assets in assets which are eligible for investment under the UCITS Directive 2009/65/EC including Investment Grade, Non-Investment Grade rated and unrated fixed income and other similar securities issued by Contributing Companies/Issuers. Securities will be primarily denominated in US Dollars.
The Sub-Fund may also invest in ESG labelled fixed income securities (""Labelled Securities"") that are aligned with the International Capital Market Association principles (""ICMA Principles""), which will not necessarily be issued by Contributing Companies/Issuers and may be issued by sovereigns provided that, the Sub-Fund will not invest more than 10% of its net assets in Labelled Securities issued by sovereigns and that any investments in Labelled Securities issued by sovereigns will be principally for liquidity management purposes. Labelled Securities include, but are not limited to, green, social, sustainable, and sustainability-linked bonds. Labelled Securities are subject to the exclusions set out under 'Excluded Activities'.
The sub-fund aims to have a lower carbon intensity relative to the Parent Benchmark.
The Portfolio Manager analyses the Sub-Fund’s ESG positive contribution as the fundamental consideration when determining the Sub-Fund’s investment universe. The Sub-Fund’s investment principles (“Investment Principles”), which are used together with ESG positive contribution analysis and fundamental qualitative company/issuer analysis to determine the Sub-Fund’s investments, may include but are not limited to:
- continuous engagement with Contributing Companies/Issuers regarding their ESG standards
- continuous engagement with Contributing Companies/Issuers regarding their ESG standards at various stages of their ESG transition
- Companies/issuers following good ESG practices, which include, but are not limited to, companies/issuers with efficient electricity and water usage and issuers with sound business ethics and transparency
- Companies/issuers following good ESG practices resulting in low and/or decreasing carbon intensity
- Labelled Securities aligned with ICMA Principles. Labelled Securities are subject to the exclusions set out under 'Excluded Activities', in the Prospectus/PCD
This ESG positive contribution analysis is proprietary to HSBC using data supplied by non-financial rating agencies and internal research. All of the companies/issuers that the Sub-Fund invests in will be subject to this ESG positive contribution analysis and fundamental qualitative issuer analysis and where required additional company specific ESG metrics will be used to demonstrate alignment with the SDG/SDGs. The result of these analyses must confirm that the relevant company/issuer meets the Portfolio Manager’s sustainable investment criteria prior to any investment being made by the Sub-Fund in such company/issuer.
The sub-fund includes the identification and analysis of an issuer’s environmental and social factors and corporate governance practices as an integral part of the investment decision making process.
Labelled Securities, environmental and social factors, corporate governance practices, lower carbon intensity, Excluded Activities, and the need for ESG due diligence may be identified and analysed by using, but not exclusively, HSBC’s Proprietary ESG Materiality Framework and ratings, fundamental qualitative research and corporate engagement. When assessing issuers’ ESG scores and/or metrics, carbon intensities or their involvement in Excluded Activities, the Portfolio Manager may rely on expertise, research and information provided by financial and non-financial data providers.
Proportion of investments
The sub-fund will make a minimum of sustainable investments with an environmental objective of 90%. Not Sustainable investments include liquid assets (ancillary liquid assets, bank deposits, money market instruments and money market funds) and financial derivatives instruments which may be used for efficient portfolio management.
Monitoring of environmental or social characteristics
All sub-funds shall demonstrate strong and/or improving ESG characteristics at the company/issuer and overall portfolio level. Such criteria can be quantitative or qualitative and are monitored on an on-going basis. HSBC Asset Management conducts on-going monitoring of sub-funds - both at the company/issuer and overall portfolio level. Companies/issuers with ESG risk scores that require targeted review are assessed within an internal governance forum. Funds are monitored via an ESG dashboard to ensure portfolios align to the internally established thresholds (for example - portfolio average ESG score, exclusions, enhanced due diligence etc.).
Investments in the sub-fund are assessed for minimum good governance practices through consideration of UNGC principles, additionally good governance practice of companies/issuers is viewed through ESG and G pillar scores. Investments considered to be Sustainable Investments must pass an additional good governance screen before they can be designated as such. Governance is assessed against criteria specified in the investment process which includes, among other things, business ethics, culture and values, corporate governance and bribery and corruption. UNGC violations are assessed through ESG due diligence as well as screening which are used to identify companies that are considered to have poor governance. Companies/issuers which meet the criteria of sustainable investment are assessed through minimum governance scores to ensure higher standards of governance and no association with severe controversy. Where relevant those companies/issuers will then be subjected to further review, action and/or engagement.
HSBC's Stewardship team meets with companies/issuers regularly to improve HSBC’s understanding of their business and strategy, signal support or concerns we have with management actions and promote best practice. HSBC believes that good corporate governance ensures that companies/issuers are managed in line with the long-term interests of their investors.
Methodologies
The sustainable investments in the sub-fund will contribute to sustainable investment objectives. Investments will be considered sustainable if they make a positive contribution in accordance with HSBC’s Responsible Investment Methodologies. This is determined by an investment meeting one or more of the following criteria:
- Promoting the highest levels of environmental and social practices
- Companies classified as net zero aligned, or better, by HSBC Asset Management’s net zero investment framework
- Generating sustainable revenues, which are determined as those which support the enhancement of the United Nations Sustainability Development Goal (UN SDGs), EU Taxonomy or climate related revenues
Companies with a positive contribution to one of the above criteria will then be subject to:
- ‘Do no significant harm’ (“DNSH”) assessment
- Good governance screening
Once an investment has satisfied the above criteria, it can then be considered as a sustainable investment.
The sustainability indicators are directly linked to the sustainable investment objective of the sub-fund.
Data sources and processing
HSBC Asset Management uses data from a number of external third parties such as Sustainalytics, ISS, MSCI and Trucost to ensure it attains the environmental characteristics promoted. HSBC Asset Management also use a number of ESG rating agencies for norms-based screening against the UN Global Compact principles.
The data is verified by HSBC Asset management's extensive research department and processed via HSBC Asset Management's propriety research methodology. HSBC Asset Management is reliant on third party data and while we verify the data, we cannot comment on limitation to the methodologies of such third-party companies. No data is estimated by HSBC Asset Management.
Limitations to methodologies and data
While HSBC Asset Management use third party data from multiple sources, HSBC Asset Management review and research such data, however there is still limited coverage of the data available. In certain asset classes, ESG data may not be publicly available via third party data providers or not sufficient. In such instances, HSBC leverages proprietary methodologies to support ESG assessments at the security and portfolio level.
HSBC Asset Management is not aware of any limitation in meeting the sustainable investment objective of the sub-fund.
Due diligence
Investments in the sub-fund are assessed for minimum good governance practices through consideration of UNGC principles, additionally good governance practice of companies/issuers is viewed through ESG and G pillar scores. Investments considered to be Sustainable Investments must pass an additional good governance screen before they can be designated as such.
Governance is assessed against criteria specified in the investment process which includes, among other things, business ethics, culture and values, corporate governance and bribery and corruption. UNGC violations are assessed through ESG due diligence as well as screening which are used to identify companies that are considered to have poor governance. Companies/issuers which meet the criteria of sustainable investment are assessed through minimum governance scores to ensure higher standards of governance and no association with severe controversy. Where relevant those companies/issuers will then be subjected to further review, action and/or engagement.
HSBC's Stewardship team meets with companies/issuers regularly to improve HSBC’s understanding of their business and strategy, signal support or concerns we have with management actions and promote best practice. HSBC believes that good corporate governance ensures that companies are managed in line with the long-term interests of their investors.
Engagement policies
HSBC's Stewardship team meets with companies regularly to improve HSBC’s understanding of their business and strategy, signal support or concerns we have with management actions and promote best practice. HSBC believes that good corporate governance ensures that companies are managed in line with the long-term interests of their investors.
HSBC Asset Management considers PAIs at group level as part of its stewardship process and companies that are flagged for severe violations or worst in class performers on certain PAIs may be subject to further dialogue and ESG due diligence. Certain PAIs will also be considered through exclusions - including for example controversial weapons and UNGC violations. Potential UNGC violations are identified by a third-party controversies-based research service.
Attainment of the sustainable investment objective
There is no specific index designated as a reference benchmark to meet the sustainable investment objective.
Alternative Solutions
Please choose your location from the list below to read disclosures for our alternative fund range.
Silkroad Asia Value Partners IV
Silkroad Asia Value Partners IV (the “Fund”) is a real estate fund that seeks to invest in mis-priced or under-valued assets in the developed markets of APAC, and to apply active management strategies to optimize the operational performance and value of the assets.
The Fund will promote environmental characteristics pursuant to Article 8 of SFDR by focusing on investment opportunities that entail adaptive reuse of existing assets; and implementing one or more of the following sustainability-driven improvements at asset-level, post-investment: (a) implementing asset energy efficiency measures; (b) implementing water efficiency measures; (c) implementing waste management measures; and / or (d) introducing green clauses to lease agreements.
In order to assess the Fund's attainment of the promoted environmental characteristics, the Fund will monitor and report a set of Sustainability Indicators. Progress against the Sustainability Indicators will be considered specifically or holistically through quantitative or qualitative feedback, depending on the asset and data availability. Progress will be reported annually, and year-on-year changes will be tracked over the holding period. The minimum proportion of the Investments of the Fund used to meet the environmental characteristics promoted by the Fund will be 80%. A ramp-up period of three years will be set for the purpose of meeting the minimum proportion of environmental characteristics promoted by the Fund.
Read the full Silk Road Asia Value Partners IV Disclosure - 9 December 2024
Global Transition Infrastructure Debt Fund
The Global Transition Infrastructure Debt Fund (the “Fund”) seeks to provide potentially attractive risk adjusted returns with a predictable income stream by investing in a diversified portfolio of loans (and other debt instruments) with infrastructure characteristics and which either are or will contribute to greenhouse gas ("GHG") emissions reduction and the global transition to net zero emissions by 2050.
The Fund will promote ESG characteristics within the meaning of Article 8 of SFDR by seeking to invest in infrastructure opportunities that meet the requirements of the relevant ESG framework of the Investment Manager. In particular, the Fund will promote ESG characteristics by not making any investments with high ESG risks as evidenced by the Investment Manager's approach to assessing ESG ratings for prospective borrowers.
Read the full Global Transition Infrastructure Debt Fund Disclosure (PDF,103KB)
Global Infrastructure Debt Strategy
Global Infrastructure Debt Strategy (“the Fund”) will seek to provide yield-based returns by investing in a diversified portfolio of high yielding debt of infrastructure projects principally associated with member countries of the Organisation for Economic Co-operation and Development (“OECD”) across a broad range of sectors that engage in the provision of essential products and services.
The Fund will target defensive and non-cyclical sectors that are engaged in the provision of essential products and services such as renewables, energy, transport, power, telecommunications, social infrastructure and other adjacent relevant sectors. Typically, these assets exhibit some or all of the following infrastructure characteristics: high barriers to entry, contracted revenue streams and inelastic demand profile.
The Fund’s investment strategy is broad and in particular not only limited to economic activities that contribute to environmental objectives. Indeed, the Fund may make investments that contribute to either social or governance objectives. The Fund is under no obligation to (but may) contribute to any environmental objective as defined under Art. 9 of the EU Taxonomy.
The Fund will promote ESG characteristics within the meaning of Article 8 of SFDR by seeking to invest in businesses that meet the requirements of the relevant ESG framework of the Investment Manager. In particular, the Company will promote ESG characteristics by not making any investments with high ESG risks as evidenced by the Investment Manager's approach to assessing ESG ratings for prospective investees.
The Investment Manager intends to engage with investees to positively influence their sustainability strategy.
Read the full Global Infrastructure Debt Strategy Disclosure (PDF,105KB)
Senior Global Infrastructure Debt Strategy
Senior Global Infrastructure Debt Strategy (“the Fund”) will seek to provide attractive long-term yield based returns by investing in a diversified portfolio of senior secured debt of infrastructure projects associated with member countries of the Organisation for Economic Co-operation and Development (“OECD”) across a broad range of sectors that engage in the provision of essential products and services. The Fund will principally invest in USD denominated assets but may also invest in assets denominated in other currencies.
The Fund will promote ESG characteristics within the meaning of Article 8 of SFDR by seeking to invest in businesses that meet the requirements of the relevant ESG framework of the Investment Manager. In particular, the Company will promote ESG characteristics by not making any investments with high ESG risks as evidenced by the Investment Manager's approach to assessing ESG ratings for prospective investees.
The Investment Manager intends to engage with investees to positively influence their sustainability strategy.
Read the full Senior Global Infrastructure Debt Strategy Disclosure (PDF,104KB)
Climate Technology Venture Strategy
Climate Technology Venture Strategy 2022 (the “Fund”) is a venture capital fund that will invest in early stage unquoted companies with a focus on energy, transportation, agricultural, and industrial decarbonisation and companies focused on the mitigation of climate change risks. The Fund promotes environmental and social characteristics by investing in companies whose activities are aligned to one or more United Nations Sustainable Development Goals (“UN SDGs”). The Fund therefore uses the UN SDGs as sustainability indicators to measure the attainment of each of the environmental or social characteristics promoted by the Fund.
In addition, the Fund seeks to make investments that contribute substantially to the environmental objectives relating to climate change mitigation, climate change adaptation and the transition to a circular economy, as defined by the Taxonomy Regulation.
The Fund will seek to monitor and enforce good governance practices across Portfolio Companies, in particular with regard to sound management structures, employee relations, employee remuneration and tax compliance.
The selection and ongoing monitoring of Portfolio Companies is based on a rigorous due diligence process which the Fund integrates into its decision making process.
Read the full Climate Technology Venture Strategy Disclosure (PDF,119 KB)
Financial Technology Venture Strategy
Financial Technology Venture Strategy 2022 (the “Fund”) is a venture capital fund that promotes environmental and social characteristics within the meaning of article 8 of the Disclosure Regulation.
The Fund does not target sustainable investments within the meaning of article 2 (17) of the Disclosure Regulation. The Fund’s portfolio may (but for the avoidance of doubt, there is no obligation to) include investments that qualify as sustainable investments within the meaning of article 2 (17) of the Disclosure Regulation.
The Fund will seek to enforce good governance practices across investee companies, in particular with regard to sound management structures, employee relations, employee remuneration and tax compliance.
The Fund aims to make minority equity investments into 15 to 20 early stage financial technology companies. It is intended that all investee companies will promote environmental and social characteristics within the meaning of article 8 of the Disclosure Regulation and be classified accordingly.
The promoted environmental and/or social characteristics are measured by the positive alignment with the UN Sustainability Development Goals, as validated by a third party provider.
The selection of target companies is based on a rigorous due diligence process. The Fund evaluates, as part of the due diligence, the companies with respect to their management structures, employee relations, and remuneration and tax compliance.
Further, an important aspect of the investment due diligence is the ESG Due Diligence. The Portfolio Manager utilises independent third party providers to provide a detailed ESG Due Diligence, which it integrates into its decision making process.
The AIFM will actively monitor sustainability indicators and ESG incidents and will review ESG progress on an annual basis.
Read the full Financial Technology Venture Strategy Disclosure (PDF,449KB)
Impact Strategy 2022
Impact Strategy 2022 is a feeder fund that invests substantially all of its assets into a KKR managed Global Impact strategy (the “Fund” or “KKR”). The Fund will invest in businesses focused on mitigating and adapting to climate change, helping people across the globe achieve learning and employment outcomes, allow for more sustainable living across cities, circular economies, and consumption, and enhance inclusion across a number of areas – with the goal of broadening and deepening their positive impact. The Fund will invest in businesses that contribute solutions to specific UN Sustainable Development Goals (UN SDGs) and generate impacts that are measurable and reportable, either directly through its core business model, or indirectly through the way the company differentiates its core business model. Additionally, KKR will seek to improve a company’s ESG performance during its period of ownership, through monitoring and reporting on ESG related performance. KKR intends to work with each portfolio company to appropriately integrate and monitor progress on material ESG issues and impact performance aligned with the UN SDGs.
All of the Fund’s investments will be subject to the Fund’s sustainable investment objective. KKR will ensure that each investment does no significant harm to other environmental or social objectives by applying the most relevant indicators (quantitative and qualitative) for adverse impacts on sustainability factors. The Fund will also check for each investment that companies have processes and compliance mechanisms to monitor compliance with the UN Global Compact principles and Organisation for Economic Cooperation and Development (OECD) Guidelines for Multinational Enterprises, and for related violations.
KKR will seek to improve a company’s ESG performance during the ownership period and will measure and report on this as guided by third party frameworks, primarily using data from portfolio companies. KKR will assess the good governance practices of each investment as part of its due diligence. At the outset and on an on-going basis, KKR will seek to ensure that each investment has sound management structures in place, including in relation to executive compensation, and has a risk framework to prevent illicit business practices or misconduct.
Impact Strategy 2023
European Senior Direct Lending Fund
The Fund will promote environmental and social characteristics within the meaning of Article 8 of the Disclosure Regulation by seeking to invest in businesses that meet the requirements of the relevant ESG framework of the Portfolio Manager. In particular, the Fund will promote environmental and social characteristics by not making any new investments (other than Follow-on Investments) into companies with a High ESG Score (1). In addition, the Fund will not make investments (other than Follow-on Investments) with a Medium ESG Score (2) unless the Investment Team believes that an improvement in the ESG Rating to a Low ESG Score (3) or a Neutral ESG Score (4) is achievable.
Read the full European Senior Direct Lending Fund disclosures (PDF, 513KB)
Read the full European Senior Direct Lending Fund disclosures – French OFS (PDF, 518KB)
Real Estate Strategy 2024
Real Estate Strategy 2024 is a master / feeder fund structure that invests substantially all of its assets into a Brookfield managed Real Estate strategy (the “Underlying Fund”).
The Underlying Fund's primary objective is to seek attractive opportunistic risk-adjusted returns by acquiring positions of control or significant influence in real estate and real estate companies globally capitalizing on market instabilities and volatility and accessing growth opportunities.
The Underlying Fund seeks to promote the four environmental and social characteristics below.
Read the full Real Estate Strategy 2024 Disclosure (PDF, 209KB)
RCF Partnership Fund
The Fund will promote environmental and social characteristics within the meaning of Article 8 of the Disclosure Regulation by seeking to invest in businesses that meet the requirements of the relevant ESG framework of the Portfolio Manager. In particular, the Fund will promote environmental and social characteristics by not making any investments into companies with a “Weak” ESG Rating evidenced by the Portfolio Manager's approach to assessing ESG ratings for prospective borrowers.
Unlaunched funds
Fund or Mandate Name |
SFDR Category (Art. 8 or 9)* | Environmental/social characteristics or sustainable investment objective |
How the environmental/social characteristics or the sustainable investment objective is met? |
How the index is aligned with the environmental/social characteristics, or the sustainable investment objective? Why and how the index used differs from a broad market index? |
| HSBC Bloomberg Global Sustainable High Yield Corporate Bond UCITS ETF | 8 | In replicating the performance of the Bloomberg MSCI Global High Yield Corporate SRI Carbon ESG-Weighted Index (the “Index”), the Fund promotes the following environmental and/or social characteristics. - a reduction in carbon emissions compared to the Bloomberg Global High Yield Corporate Index (the “Parent Index”); and - an improvement of the MSCI ESG rating against that of the Parent Index. The Fund seeks to achieve the promotion of these characteristics by replicating the performance of the Index which removes companies based on sustainability exclusionary criteria and United Nations Global Compact exclusionary criteria and which weights companies in order to reduce the exposure to companies with higher carbon emissions and fossil fuel reserves and to improve the exposure to companies with favourable ESG ratings. The Index has been designated as a reference benchmark for the purpose of attaining the environmental and/or social characteristics promoted by the Fund. |
The sustainable investments made by the Fund are aligned to the environmental and/or social characteristics which it promotes. The Fund replicates the performance of the Index, the focus of which is to achieve a reduction in carbon emissions and an improvement of the MSCI ESG Rating against that of the Parent Index . By replicating the performance of the Index, the investments of the Fund contribute to these sustainable objectives. |
The following types of issuers are removed from the Index on an ongoing basis due to the sustainability exclusionary criteria and some criteria may apply thresholds: Issuers with MSCI ESG Ratings lower than BB, issuers with an ESG Pillar score of less than 2, unrated issuers from sectors with ratings. The index also negatively screens issuers that are involved in business activities that are restricted because they are inconsistent with certain values-based business involvement criteria, including activities with high carbon intensity or related to controversial weapons, and those issuers with a “red” MSCI ESG Controversy Score. On a monthly basis the weight of each constituent issuer is adjusted by a fixed multiplier, as set out in the Index methodology, which is determined by its MSCI ESG Rating. The Index will be rebalanced on a monthly basis in order to account for the eligibility criteria. The Index seeks to achieve a reduction in carbon emissions and an improvement of the MSCI ESG rating against that of the Bloomberg Global High Yield Corporate Index. The Index achieves this by removing, on a monthly basis, securities based on sustainability exclusionary criteria. The following types of issuers are removed from the Index on an ongoing basis due to the sustainability exclusionary criteria and some criteria may apply thresholds: MSCI ESG Rating Business Involvement Screens Issuers with a “red” MSCI ESG Controvery score (i.e. less than 1). The weight of each constituent issuer is adjusted by a fixed multiplier, as set out in the Index methodology, which is determined by its MSCI ESG Rating. Each constituent is capped at 2% by market value. |
| HSBC Global Funds ICAV - Global Sustainable Government Bond Index Fund | 8 | In tracking the performance of the Bloomberg MSCI Global Treasury ESG Weighted Bond (USD unhedged) Index (the “Index”), the Fund promotes environmental and/or social characteristics by seeking to improve the MSCI ESG rating against that of the Bloomberg Global Aggregate Treasury Index (the “Parent Index”). The Fund seeks to achieve the promotion of these characteristics by tracking the performance of the Index which uses MSCI ESG sovereign scores to tilt country allocations above or below their market value weights in the Parent Index and excludes countries with a country score 5 and below in order to reduce exposure to countries with high exposure to and/or low management of ESG risks and to improve the exposure to countries with favourable ESG ratings. The Index has been designated as a reference benchmark for the purpose of attaining the environmental and/or social characteristics promoted by the Fund. |
The sustainable investments made by the Fund are aligned to the environmental and/or social characteristics which it promotes. The Fund tracks the performance of the Index, which uses environmental, social and governance (ESG) sovereign scores to tilt country allocations above or below their market value weights in the Bloomberg Barclays Global Aggregate Treasuries Index. By tracking the performance of the Index, the investments of the Fund contribute to these sustainable objectives. |
The weight of each index eligible security is adjusted by a fixed multiplier which is determined by the market value weight the issuing country holds within the Parent Index along with its ESG sovereign score (0-10) (based on data from MSCI ESG Research). Countries must have a country score over 5 before they are included in the Index. The ESG sovereign scores are determined based on an assessment of a country's exposure to and management of ESG risks. Efficiency of resource utilisation, performance on socio-economic factors, financial management, corruption control, political stability and other factors define the parameters for measuring a countries ESG risk management. The Index will be rebalanced on a monthly basis in order to account for the eligibility criteria. The Index measures the performance of investment grade, fixed-rate, taxable securities issued by government and government-related issuers using ESG sovereign scores to tilt country allocations above or below their market value weights in the Bloomberg Global Aggregate Treasury Index. On a monthly basis, the Index uses fixed multipliers to adjust the weight of each eligible security in the Index above or below their market value weights in the Parent Index. Security weights are then normalized using these adjusted market values. |
| HSBC Global Funds ICAV - Global Sustainable Corporate Bond Index Fund | 8 | In tracking the performance of the Bloomberg MSCI Global Corporate SRI Carbon ESG-Weighted Bond Index (total return hedged to USD (the “Index”), the Fund promotes environmental and/or social characteristics by seeking to reduce carbon emissions compared to the Bloomberg Global Aggregate Corporate Index (the “Parent Index”); and improve the MSCI ESG rating against that of the Parent Index. The Fund seeks to achieve the promotion of these characteristics by tracking the performance of the Index which is a multi-currency benchmark that tracks the fixed-rate, investment-grade corporate debt, and includes issuers with MSCI ESG Ratings of BB or higher. The Index also negatively screens issuers that are involved in business activities that are restricted because they are inconsistent with certain values-based business involvement criteria, including activities with high carbon intensity or related to controversial weapons, and those issuers with a "red" MSCI ESG controversy score. The Index has been designated as a reference benchmark for the purpose of attaining the environmental and/or social characteristics promoted by the Fund. |
The sustainable investments made by the Fund are aligned to the environmental and/or social characteristics which it promotes. The Fund tracks the performance of the Index, which includes issuers with MSCI ESG Ratings of BB or higher and negatively screens issuers that are involved in business activities that are restricted because they are inconsistent with certain values-based business involvement criteria, including activities with high carbon intensity or related to controversial weapons, and those issuers with a "red" MSCI ESG Controversy Score. By tracking the performance of the Index, the investments of the Fund contribute to these sustainable objectives. |
The following types of issuers are removed from the Index on an ongoing basis due to the sustainability exclusionary criteria and some criteria may apply thresholds: Issuers with MSCI ESG Ratings lower than BB, issuers with an ESG Pillar score of less than 2, unrated issuers from sectors with ratings. The index also negatively screens issuers that are involved in business activities that are restricted because they are inconsistent with certain values-based business involvement criteria, including activities with high carbon intensity or related to controversial weapons, and those issuers with a “red” MSCI ESG Controversy Score. On a monthly basis the weight of each constituent issuer is adjusted by a fixed multiplier, as set out in the Index methodology, which is determined by its MSCI ESG Rating. The Index will be rebalanced on a monthly basis in order to account for the eligibility criteria. The Index is a multi-currency benchmark that tracks the fixed-rate, investment-grade corporate debt, and includes issuers with MSCI ESG Ratings of BB or higher. The index also negatively screens issuers that are involved in business activities that are restricted because they are inconsistent with certain values-based business involvement criteria, including activities with high carbon intensity or related to controversial weapons, and those issuers with a "red" MSCI ESG Controversy Score. The Index achieves this by removing, on a monthly basis, securities based on sustainability exclusionary criteria. The following types of issuers are removed from the Index on an ongoing basis due to the sustainability exclusionary criteria and some criteria may apply thresholds: MSCI ESG Rating Business Involvement Screens Issuers with a “red” MSCI ESG Controvery score (i.e. less than 1). The weight of each constituent issuer is adjusted by a fixed multiplier, as set out in the Index methodology, which is determined by its MSCI ESG Rating. Each constituent is capped at 2% by market value. |
| HSBC Global Funds ICAV - Global Equity ESG Index Fund | 8 | In tracking the performance of the MSCI World ESG Leaders Net Total Return Index (the “Index”), the Fund promotes environmental and/or social characteristics by seeking to gain exposure to companies demonstrating both a robust ESG profile as well as a positive trend in improving that profile. The evaluation framework used in MSCI ESG Controversies is designed to be consistent with international norms represented by the UN Declaration of Human Rights, the International Labour Organisation ("ILO") Declaration on Fundamental Principles and Rights at Work, and the UN Global Compact.("UNGC"). Index constituents are a sub-set of the constituents of the MSCI World Index (the "Parent Index"). The Fund seeks to achieve the promotion of these characteristics by tracking the performance of the Index where by applying the MSCI ESG Ratings methodology and MSCI ESG Controversies ratings methodology to the Index, the constituents of the Index must have an MSCI ESG rating of "BB" or above and an MSCI ESG controversies score of 1 or above to be eligible for inclusion in the Index. For companies that are constituents of the Parent Index but not existing constituents of the Index, they must have an MSCI ESG Rating of 'BB' or above and the MSCI ESG Controversies Score of 3 or above to be eligible for inclusion in the Index. In addition, companies showing involvement in alcohol, gambling, tobacco, nuclear power and weapons are excluded from the Index. The Index has been designated as a reference benchmark for the purpose of attaining the environmental and/or social characteristics promoted by the Fund. |
The sustainable investments made by the Fund are aligned to the environmental and/or social characteristics which it promotes. The Fund tracks the performance of the Index, the focus of which is to gain exposure to companies demonstrating both a robust ESG profile as well as a positive trend in improving that profile against that of the Parent Index . By tracking the performance of the Index, the investments of the Fund contribute to these sustainable objectives. |
Applying the MSCI ESG Ratings methodology and MSCI ESG Controversies ratings methodology to the Index, the constituents of the Index must have an MSCI ESG rating of "BB" or above and an MSCI ESG controversies score of 1 or above to be eligible for inclusion in the Index. For companies that are constituents of the Parent Index but not existing constituents of the Index, they must have an MSCI ESG Rating of 'BB' or above and the MSCI ESG Controversies Score of 3 or above to be eligible for inclusion in the Index. In addition, companies showing involvement in alcohol, gambling, tobacco, nuclear power and weapons are excluded from the Index. An annual review of the Index takes place in May, the Index is rebalanced in August, November and February The Index is designed to provide a broad, diversified sustainability benchmark through exposure to companies with high Environmental, Social and Governance ("ESG") performance relative to their sector peers. Index constituents are a sub-set of the constituents of the MSCI World Index (the "Parent Index"). The Index achieves this by applying the MSCI ESG Ratings methodology and MSCI ESG Controversies ratings methodology to the Index, the constituents of the Index must have an MSCI ESG rating of "BB" or above and an MSCI ESG controversies score of 1 or above to be eligible for inclusion in the Index. For companies that are constituents of the Parent Index but not existing constituents of the Index, they must have an MSCI ESG Rating of 'BB' or above and the MSCI ESG Controversies Score of 3 or above to be eligible for inclusion in the Index. In addition, companies showing involvement in alcohol, gambling, tobacco, nuclear power and weapons are excluded from the Index. |
Change Log
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1 Article 8 SFDR : The product promotes environmental or social characteristics, or a combination of those characteristics, provided that the companies in which the investments are made follow good governance practices.
2 Article 9 SFDR : The product has a sustainability objective.