A news release said that the strategy, developed in conjunction with the International Finance Corporation (IFC), Rexiter Capital Management Limited, and Innovest Strategic Value Advisors, Inc., is based on a two-year track record that has outperformed its benchmark since inception in September 2004.
The strategy is designed to integrate environmental, social and governance (ESG) factors into its portfolio construction process and aims to outperform the return of the MSCI Emerging Markets Index annually by 4% over the course of a full market cycle.
The Rexiter Global Emerging Markets Sustainability Strategy aims to establish best practice for future sustainability strategies in emerging market equities, the news release said.
“Sophisticated investors are increasingly becoming aware of the impact of sustainability factors on investment value,” said Bill Page, chair of SSgA’s environmental, social and governance team. “This new strategy utilizes an established investment process and combines it with a rigorous environmental, social and governance stock-rating methodology that aims to generate attractive risk-adjusted returns.”
The strategy, managed by Rexiter applies a sustainability overlay implemented by Innovest IFC, which played a key role in the development of the strategy’s concept and structure.