Wells Fargo Offers ‘Climate Transition’ Bond Portfolios to Professional Investors – MarketWatch

By Dieter Holger

Wells Fargo Asset Management launched fixed-income portfolios that support the decarbonization of the economy, tapping institutional investors who want to align their investments with a net-zero future.

The money manager, with some $590 billion under management, said Tuesday that its so-called Climate Transition Global Investment Grade Credit strategy will actively pick bonds from firms that are prepared for the move to a low-carbon world.

Investment standards include the decarbonization of portfolios by 2050 or sooner and an at least 30% cut in carbon intensity from the parent benchmark–the Bloomberg Barclays Global Aggregate Corporate Index.

Earlier this year, the U.K. government-created pension fund National Employment Savings Trust–known as Nest–converted an existing $2 billion managed by Wells Fargo to the strategy.

“Our members are likely to be significantly impacted if climate change isn’t addressed, with a strong chance of lower returns at retirement,” said Diandra Soobiah, head of responsible investment at Nest.

Write to Dieter Holger at dieter.holger@wsj.com; @dieterholger