East Capital celebrates LuxFlag award for GEM fund

The fund group assesses and monitors companies using a proprietary ESG scorecard system

East Capital’s Global Emerging Markets Sustainable fund – which according to the firm has outperformed the market by over 8% – has been awarded the LuxFLAG ESG Label.

To be eligible for the ESG Label, a fund must screen 100% of its invested portfolio according to the ESG standards recognised by international non-profit LuxFLAG.

Created in Luxembourg in 2006 by seven public and private founding partners including the Luxembourg Government, the European Investment Bank, and the Luxembourg Stock Exchange, LuxFLAG’s primary objective is to reassure investors that the strategy of a certified fund incorporates ESG factors throughout its entire investment process.

Sweden-based East Capital, which specialising in emerging and frontier markets, said its fund has outperformed the industry benchmark by 8.45% as of the end 2019, since its launch on 9 January 2019.

East Capital assesses and monitors companies using a proprietary ESG scorecard system to generate a sustainability rating for its holdings, which it uses for portfolio allocation and risk management of the fund.

The fund – which targets a low turnover rate by investing in companies with long-term growth prospects – includes investment in five big sectors including financial services, technology, cyclical consumer goods, communication services and real estate.

“The strategy of our fund is to invest in companies that successfully manage sustainability risks and opportunities, while contributing to sustainable development in emerging markets,” Karine Hirn, partner and chief sustainability officer at East Capital, commented.

“LuxFLAG’s evaluation process is very rigorous, so we are pleased that our efforts have been recognised and can be brought to the attention of the wider market,” Hirn added.

Sachin Vankalas, director general of LuxFLAG, said: “The LuxFLAG ESG Label is widely recognized for its rigorous approach in assessing a fund’s investment strategy, the level of integration of ESG criteria into the investment process and the degree of transparency provided to investors.

“It’s a testament to the qualities of East Capital Global Emerging Markets Sustainable fund that it has been awarded the LuxFLAG ESG Label for use throughout 2020.”