This article first appeared in The Edge Malaysia Weekly on November 27, 2023 - December 3, 2023

The ESG investing journey still has a long way to go, and that attention will continue to focus on climate change and investing for a better world.” - Farid

Two wholesale feeder ESG funds from RHB Asset Management clinched awards at The Edge Malaysia ESG Awards 2023. RHB ESG Multi-Asset Fund took the gold award in the best fund based on asset class (allocation) category, while the RHB Climate Change Solutions Fund won silver in the best impact fund (resource security) category.

RHB ESG Multi-Asset Fund feeds into the BlackRock ESG Multi-Asset Fund, which invests in equities, fixed income, clean energy, social housing, gold and other hedging strategies. The RHB Climate Change Solutions Fund feeds into the JPMorgan Asset Management’s Climate Change Solutions Fund, which invests in a portfolio of companies developing climate change solutions.

Mohd Farid Kamarudin, managing director and CEO of RHB Asset Management, says these target funds offer a diversified portfolio across countries, sectors and ESG themes. “These funds aim to provide better risk-adjusted returns in an uncertain world over the medium to long term. Key themes include renewable energy, sustainable transport and construction, innovative farming, water, and waste management,” he adds.

“The ESG investing journey still has a long way to go, and that attention will continue to focus on climate change and investing for a better world. RHB Asset Management has continuously enhanced our ESG approach and remains at the forefront of this journey. As we progress, we have also gained local and regional recognition.”

Both target funds will utilise active asset management and dynamic position monitoring to navigate periods of uncertainty in the coming year.

“As the world pivots to new opportunities, especially towards carbon neutrality, it is also important to continuously monitor key risks, including geopolitical tensions and changes in the global growth outlook. Higher-quality assets, such as companies with stable revenue generation and healthier balance sheets, are better placed to withstand the current market environment,” says Farid.

He adds that there must be a firm conviction in the embedded resilience of ESG strategies in these funds and there must be clear evidence of good practices.

“The growing trend towards sustainable investing worldwide has encouraged local corporates to promote the sustainable agenda, which the Malaysian government has led with notable initiatives such as the National Energy Transition Roadmap and the Joint Committee on Climate Change by Bank Negara Malaysia and the Securities Commission Malaysia. We are encouraged by the national commitment to drive sustainable investing, which will lead to higher demand for these assets,” he says.

RHB Asset Management currently has eight Sustainable and Responsible Investment and ESG funds in its portfolio of funds. These eight funds offer various asset classes, investment strategies and thematic exposure, including impact investing.

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