• MAPFRE AM has four funds that meet environmental, social and governance criteria
• These products have performed better than benchmark indices during these months of volatility
So far this year, the net underwriting for the mutual funds of MAPFRE AM, the insurance group’s management company, has been positive. But that momentum is largely due to the company’s range of socially responsible investment products. Specifically, it has four funds that meet environmental, social and governance (ESG) criteria, all of which have recorded net gains of 62 million euros, according to data from the end of May.
The product most recently launched on the market by the management company is MAPFRE AM Compromiso Sanitario, a guaranteed fund with a social impact bond issued by the Madrid local government as its underlying asset. The money collected through this initiative was dedicated to the fight against COVID-19. But this fund is joined by three others that focus on all three letters of the acronym — E, S and G.
Firstly, there is MAPFRE Inclusión Responsable (MIR), which was launched at the end of last year together with MAPFRE AM’s French partner La Financière Responsable (LFR) and invests in companies that promote the inclusion of people with disabilities. It was cited by the United Nations as an example of best practice. The MIR has led the way in terms of monitoring progress toward the UN’s Sustainable Development Goals (SDG) and, with this experience, MAPFRE applied this analysis to the group’s entire investment portfolio and presented it at its last Annual General Meeting. Within the ESG indicators that we use in the MIR, two data stand out: the employment rate for the disabled group in the fund’s portfolio companies is 3.82% and the volume of CO2 emissions for portfolio companies is 66% lower than that of the Stoxx 50.
This set is completed by MAPFRE AM Good Governance, a global equity fund whose portfolio includes companies with good corporate governance, and MAPFRE AM Capital Responsable, which invests in companies that meet the ESG criteria. The latter also comes in the form of a pension fund, which has registered net gains worth almost 12 million euros in the same period.
The improved performance of ESG funds is monitored not only in terms of equity, but also on the basis of profitability. All four products have exceeded their benchmark indices, not only for this year so far, but also since February 24, when market volatility began as a result of the pandemic. For example, MAPFRE AM Good Governance had a positive balance of 0.99 percent in the first five months of the year, compared to the 9.37-percent decline of the Stoxx Global TMI. Since February 24, this has fallen by 5.16 percent, compared to the 13.38-percent decline of the index. And thanks to last week’s momentum, it already has a positive balance of over 5%.
There is a similar situation as regards MAPFRE Capital Responsable, which has declined by 3.34 percent, compared to the 8.01-percent drop of the EAA Fund EUR Moderate Allocation. For its part, MAPFRE Inclusión Responsable has fallen by 14.24 percent, compared to the 19.02-percent decline of the Euro Stoxx 50 in the same period. “I am convinced that investments with ESG criteria, with which we not only seek financial return, but are also helping to improve society in some way, will come out of this crisis stronger. You only need to look at how they have performed during these months of extreme market volatility to understand that an increasing number of clients are relying on these types of products,” says Álvaro Anguita, CEO of MAPFRE AM.