Northern Trust Asset Management has teamed up with GRESB to launch a sustainable real estate index and a Dutch-pooled fund tracking the index.
The fund is designed to provide passive investors with exposure to the performance of listed real estate companies in developed markets while integrating responsible investment criteria.
The index is being described as an “industry first”.
The asset manager said it was developed “in response to demand for a passive approach to real estate investing incorporating environmental, social and governance (ESG) factors”.
It uses data from GRESB, an organisation based in Netherlands that assesses the ESG performance of real estate portfolios and infrastructure assets.
Sander Paul van Tongeren, managing director of GRESB, said: “The environmental performance of buildings has been shown to have a clear link with the underlying financial performance of the assets, and with the risk/return profile of property companies or investment funds ultimately owning the assets.”
He added: “This new fund will, uniquely, allow investors to passively gain exposure to companies that are highly transparent about their ESG performance and reducing environmental and social impact while also incorporating broad geographic and sector diversification.”
He also said the use of GRESB’s ESG data “further institutionalises the important role of environmental, social and governance information in the financial market”.
GRESB launched a real estate sustainability benchmark for infrastructure assets in September 2015 and one for real estate development in April 2016.
It released the findings of its first assessment of infrastructure funds in October last year.
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