Sustainable Investment: UOBAM (Malaysia) Launches its First Shariah-Compliant ESG Fund

UOB Asset Management (Malaysia) (UOBAM Malaysia) had launched the United-i Asia ESG Income Fund (UiAIF), which seeks to provide retail investors with income dividends and capital appreciation over medium to long term through sustainable investments. The fund invests in a diversified portfolio of equities and debt instruments issued by companies across Asia (excluding Japan) region that comply with Shariah principles and adopt environmental, social and governance (ESG) considerations into their business models and practices.

As both Shariah principles and sustainable investing promote governance stewardship and value creation, combining these approaches will create a stronger

portfolio for investors’ long-term benefit. Shariah-based investing prohibits interest, security lending and short-selling. It also incorporates negative screening to exclude sectors such as tobacco, alcohol and breweries, weapons and armaments, as well as other non-halal products. This will be complemented by sustainable investing that uses positive screening as a means of selecting the best performing companies that offer environmentally-friendly products

and services, or have socially-responsible business practices.

Lim Suet Ling, Chief Executive Officer of UOBAM (Malaysia), said, “The launch of the UiAIF is timely as the COVID-19 pandemic has given everyone a good reason to reassess the importance of being sustainable in what we do and how we invest. With the disruption to our daily activities, from where we go to how we interact with others, come opportunities to reimagine what is possible to ensure that create a better future.

“To help businesses advance responsibly, we also engage with our portfolio companies to help improve the sustainability of their practices. We will continue to offer more ESG- focused funds that will align with the United Nations (UN) Sustainable Development Goals so that together with our partners and investors, we will forge a sustainable future for all,” she added.

With sustainable investing becoming a major force across global financial markets, UOB Asset Management is committed to providing sustainable investment solutions to creating long-term returns for investors

across Asia. In January 2020, UOB Asset Management Ltd, the parent company of UOBAM (Malaysia), became a signatory of the UN-supported Principles for Responsible Investment, which was developed by an international group of institutional investors to encourage the increasing relevance of ESG issues to investment practices.

The UiAIF is suitable for retail investors who have a moderate risk profile. It is available in Malaysian Ringgit, Australian Dollar and US Dollar with an initial minimum investment of RM1,000, AUD1,000 and US$1,000 respectively. UOBAM (Malaysia) is the manager of the UiAIF, while UOB Islamic Asset Management Sdn Bhd is the investment manager.

The UiAIF is available for subscription at selected distributors nationwide. For more information, please visit www. uobam.com.my.

*The facts and views expressed are solely that of the author and do not necessarily reflect that of the editorial board. Please consult your financial professional if you want to make any investment decision.