Event Voice: Your Questions Answered by Northern Trust Asset Management at the November Funds to Watch 2022

clock • 2 min read
Morten Olsen, Global Fixed Income Head of Business Strategy, Northern Trust Asset Management
Image:

Morten Olsen, Global Fixed Income Head of Business Strategy, Northern Trust Asset Management

Can you give a brief overview of your strategy in terms of what you are trying to achieve for investors. 

The NT Global Bond ESG Climate Index solutions provide a distinct opportunity to invest sustainably in fixed income both in corporate and government bonds. Available in 1-5y duration and a standard approx. 7.5y duration, this passive strategy provides exposure to government, government-related, corporate and securitised bonds and tracks the custom indices within the Solactive Global Bond ESG Climate Index range, in alignment with a global aggregate bond portfolio.

What is your investment process?

Within government bonds, our ESG & Climate framework combines fiscal strength, governance, and carbon metrics. Good governance and fiscal prudence complement traditional credit evaluation, and a carbon reduction target is added to hedge climate change risks. ‘Fiscal Strength' reflects whether a country has sufficient financial capital to manage ESG risks. ‘Governance' captures a country's capacity to address environmental and social risks through its financial, judicial, and political systems. The carbon emissions & intensity reduction target, with a carbon trend score for the improvement over the past three years, provides the climate metric of the framework.

Within corporate bonds, we apply our NT Custom ESG exclusions removing the worst violators of the U.N. Global Compact, weapons, the tobacco value chain, thermal coal miners & coal fired generators, for profit prisons. We then target a reduction in carbon intensity and an uplift in carbon risk rating.

What is the make-up of the investment team?

Fixed income is a key expertise for Northern Trust Asset Management representing more than $400billion in asset under management (as of September 30th 2022). Our fixed income investment team consists of 67 professionals with an average of 19 years of industry experience. Overall responsibility lies with Thomas Swaney, Chief Investment Officer of Global Fixed Income, who reports to Angelo Manioudakis, CFA, Chief Investment Officer at Northern Trust Asset Management.

Mike Chico is lead portfolio manager for the NT Global Bond ESG Climate Index strategies and is responsible for daily portfolio oversight and activity, ensuring proper weighting of major sectors and overall characteristics and risk. Mike is supported by our team of sector specialist portfolio managers in charge of trading in assigned sectors, enabling better information on liquidity / transaction costs, and facilitating portfolio construction and sampling decisions.

Click here to learn more about Northern Trust Asset Management

More on Economics

Consumer confidence dips for first time in three months

Consumer confidence dips for first time in three months

Higher than a year ago

Cristian Angeloni
clock 23 February 2024 • 2 min read
Fiscal rules 'close to meaningless' unless sensitivity to OBR forecasts is reduced

Fiscal rules 'close to meaningless' unless sensitivity to OBR forecasts is reduced

Trio of economists tell Treasury Committee

Cristian Angeloni
clock 22 February 2024 • 5 min read
Fed officials 'highly attentive' to inflation despite recent progress

Fed officials 'highly attentive' to inflation despite recent progress

Outlook is 'uncertain'

clock 22 February 2024 • 1 min read
Trustpilot