Hanwha Asset Management Launches 'Hanwha ESG Hero Fund'

[Asia Economy Reporter Eunmo Koo] Hanwha Asset Management announced on the 2nd that it has launched the ‘Hanwha ESG Hero Fund (Bonds)’, which invests using its proprietary ESG (Environmental, Social, and Governance) evaluation system.

Hanwha Asset Management is the first domestic asset management company to develop and utilize its own ESG evaluation system. Developed under the leadership of ESG specialists, this proprietary evaluation system is distinctive in that it can assess not only listed companies but also unlisted bond issuers and public enterprises. By establishing evaluation questions and scoring that consider the characteristics of industries and companies, it effectively manages risks and issues, enhances returns and stability, and can be applied throughout the investment process as an overall management tool. Currently, it evaluates and operates over 1,000 companies.

The ‘Hanwha ESG Hero Fund (Bonds)’ pursues optimal performance by combining three bonds with different investment targets, strategies, and maturities (Hanwha Korea Value Bond, Hanwha Short-term Government Bond, Hanwha Korea Total Bond) based on the ESG evaluation system. Investing in this fund enables phase-specific asset allocation effects within bond assets. Specifically, during periods of rising interest rates, the fund increases the proportion of the short-term bond fund ‘Hanwha Short-term Government Bond’, and during periods of falling interest rates, it increases the proportions of the long-term bond funds ‘Korea Value Bond’ and ‘Korea Total’ to pursue additional returns.

Park Tae-woo, Strategist of the FI Business Division at Hanwha Asset Management, explained, “Hanwha Management’s system allows detailed item monitoring upon investor request, and recently, it has included evaluation of carbon emissions relative to sales, which other institutions have not adopted, in the management fund targets. Based on quantitative data analysis, it judges the phases of the bond market through collective intelligence and enables optimal risk-return management according to the allocation ratios of the asset allocation model.”

Recently, global funds inflow into ESG investment destinations has rapidly expanded, centered on global pension funds and sovereign wealth funds. This is both a result of increased interest in socially responsible investment and the trend of strengthening environmental regulations such as the coal phase-out movement and the introduction of carbon taxes, which have expanded risks for related companies. Proactive response to ESG risks is expected to be a key factor in enhancing investment performance.

Choi Jang-won, Head of the FI Business Division at Hanwha Asset Management, stated, “An environment favorable to ESG investment is being created due to the government’s emphasis on social value and responsible investment. Domestically, as of the end of October, the issuance of ESG bonds has approached 75 trillion won, and the issuance scale has increased more than threefold compared to 2019, making it an attractive investment destination for investors who prefer stability.”

The ‘Hanwha ESG Hero Fund’ is available for subscription through Hanwha Investment & Securities, with total fees of 0.35% per annum for Class A (0.3% upfront sales commission on the payment amount separately) and 0.45% for Class C.

This content was produced with the assistance of AI translation services.