Page 50 - BANKING FINANCE MARCH 2024

ARTICLE

Green Investments and Mutual

Funds

G reen Investment has become a very popular term Corporate Enterprises can invest in Green Bonds. They can

nowadays specially with respect to Mutual Fund
take Green Loans also from Financial Institutions.
and Alternative Investment Fund. Let us examine
what Green Investment is in reality, how the
investments in Green Sectors. Mutual Funds offer one such
concept has originated, the reasons of its popularity in Let us concentrate solely on Individual Investors and their
Personal Finance Sector and above all, how it is influencing opportunity to individual investors. SEBI Norm is that 65%
the financial decisions of an individual investor. of these funds have to be invested in listed shares of
companies for which submission of Business Responsibility
We are keeping discussion on Alternative Investment Fund and Sustainability Report to SEBI is essential. These Mutual
out of purview because it pertains to Real Estate sector, Funds invest in companies that meet Environmental, Social
Personal Equity, Venture Capital etc and dominated by and Corporate Governance Standards and adopt ethical
Corporate Finance. practices to earn profit. Common investors are recognising
gradually the importance of aligning with investment with
Green Investment is defined as Investment of Funds in
Sustainable, Non-pollutant Industries. Example of such ethics and principles.
Industries are Renewable Energy sector, such as Wind Power SEBI has mandated asset management companies to ensure
and Solar Energy, Automobile Industries manufacturing
that at least 80% of the total asset under management of
Electric Vehicles, Manufacturing of lithium batteries. Water
and Forest Conservation Projects are other Green ESG schemes are invested in equity and equity related
Investments. instruments of any particular theme ( health care, clean
water etc themes) while the remaining investment part
Green Funds are called ESG Funds also. The whole World is can't be in contrast to that strategy.
drifting towards avoidance of ESG Risks. Concept of ESG has
three pillars - Environment, Social and Governance. Top Five Market Leaders in terms of AUM and other factors
Objectives of ESG measures are - (1)Making our Planet a safe in the field of Green Investments Mutual Funds are-
place to live without pollution in risk free environment and A. SBI MAGNUM EQUITY ESG FUND ( GROWTH):
(2) Maximisation of Wealth of all Stakeholders in every It is the leading ESG MF in the market with almost 50 %
Enterprises. Sustainable Growth and Development is another of market share in AUM and already 5 years old find. It
dimension of Green Investments. has generated12.3% return in past one year. There is no
lock in period. Minimum SIP amount of the fund is Rs1000.
About the author B. Kotak ESG Opportunity Fund ( Growth):
This MF investment has a current AUM of Rs1100 CR
Arup Dasgupta and no lock in period. Investors can invest Rs1000
Is a veteran of insurance industry for through SIP.
last 33 years. He was Chief Executive
Officer of LIC Bangladesh. He was also C. AXIS ESG EQUITY FUND( GROWTH):
Regional Manager of Eastern India both Since inception , this fund has given 14.2% return. It's
for marketing and Housing Finance of AUM is Rs1496cr.
LIC. He is fellow member of Insurance
Institute of India and Institute of Cost ICICI PRUDENTIAL ESG FUND( GROWTH):
and Management Accountants of India. It has AUM Rs 1496 CR.

46 | 2024 | MARCH | BANKING FINANCE