US-based investment specialist, Matthews Asia, has launched a new fund after five of its existing UCITS funds were categorized as Article 8 funds under the SFRD regulation.

This week, Matthews Asia launched the Matthews Asia Sustainable Future Fund, its first Article 9 UCITS strategy under the Sustainable Finance Disclosure Regulation.

The fund aims to generate long-term capital appreciation by investing in companies that contribute to a sustainable future and are addressing global environmental and social challenges while following good governance principals, the firm said.

Companies are evaluated through a sustainable investment framework, with a focus on their contribution to, or potential future contribution to, positive social and environmental outcomes. These include, for example, climate change mitigation and adaptation; sustainable production and consumption; health and wellbeing.

For investors building sustainable portfolios, Matthews Asia believes that it is critical to include an allocation to Asia. The region, it says, is the epicentre of many global sustainability challenges and solutions, such as climate change, poverty alleviation, access to affordable healthcare, housing, and financial inclusion.

In Matthews Asia’s view, investing in Asia through a sustainability lens has the potential not only to generate attractive long-term returns but also to drive positive social and environmental outcomes at scale.

The Matthews Asia Sustainable Future Fund follows a similar investment approach as the Matthews Asia ESG Fund, which has been available to investors in the US since 2015, the firm said. Both funds are managed by Vivek Tanneeru, lead manager, and supported by Kathlyn Collins, analyst and head of ESG at Matthews Asia.

“Asia is an extraordinarily diverse region and offers a deep universe of sustainable investment opportunities across frontier, emerging and developed markets,” Tanneeru said.

The Matthews Asia Sustainable Future Fund also seeks to engage with companies in order to encourage sustainable practices that will help shape the world of tomorrow on topics such as climate risk disclosure, health and safety standards, the level of independent directors and gender diversity on boards, the firm added.

“We have seen a structural shift in investor priorities in recent years, with sustainability and outcome-based objectives becoming an important requirement when making investment decisions,” Jonathan Schuman, global head of distribution, said.

“We are therefore pleased to launch the Matthews Asia Sustainable Future Fund for our global clients, our first SFDR Article 9 strategy,” he added.

Matthews Asia also said that five of its existing UCITS funds have now been categorized as Article 8 funds under the SFRD regulation, including the recently-launched Matthews China A-Shares Fund, Matthews Asia ex Japan Dividend Fund, Matthews Pacific Tiger Fund, Matthews Japan Fund, and Matthews China Fund.

Based in San Francisco, Matthews Asia is the largest dedicated Asia investment specialist in the United States, with around $17.4 billion in assets under management as of June 30, 2022.