While impact investing is growing in popularity, there are few fixed-income funds providing Americans access to this space.

Enter Boston-based Columbia Threadneedle Investments, a subsidiary of Ameriprise Financial, which launched the Columbia U.S. Social Bond Fund last year to fill what portfolio manager James Dearborn sees as a gap in impact-focused fixed income investments.

“We kept hearing there was a dearth of fixed-income products available for investors in this part of the market,” Dearborn says. “There are only one or two muni bond funds, but they’re hard to understand, they don’t really seem to have a core premise. Investors like muni bonds because they’re tax advantaged. We’ve found a place where we can provide healthy investment returns and focus on doing good in our communities.”

Dearborn is Columbia Threadneedle’s head of municipal bond investments, and is marking his 20th year with the firm and his 30th year as an investment professional in 2016.

Currently, 100 percent of the fund’s holdings are bonds, 90 percent municipal, and at any given time at least 60 percent of those holdings are municipal bonds, which qualifies any income from its municipal holdings for federal tax exemptions.

Dearborn says by using municipal bonds, he can eliminate many of the difficulties in marketing sustainable investments.

“No one has thought of muni bonds as part of a societal benefit,” Dearborn says. “They’re part of the capital formation process for local governments trying to build infrastructure. Municipal bonds are so straight forward that they made a lot of sense to us.”

The fund has a European cousin -- the Threadneedle U.K. Social Bond Fund, which invests in corporate bonds looking to foster socially responsible economic development -- that led to inquiries from American investors, Dearborn says.

“There was a need for this in the U.K., so Threadneedle worked with an NGO to identify bonds that fit their definition of socially responsible investments,” Dearborn says. “U.S. investors couldn’t buy in, though, it was U.K. only. They wanted us to build a fund here in the U.S. using munis.”

One major problem for portfolio managers is how do they decide which companies are meeting their funds' goals — what defines a socially responsible bond? In the case of "green" investing, third-party rating agencies have attempted to build frameworks for scoring securities, but Dearborn says these frameworks can be too liberal or too limiting at times.

“We believe there should be something behind the project,” Dearborn says. “For example, a lot of sewer bonds are just water and sewer bonds, but they put ‘green’ behind it because it could improve water quality or reduce waste. We don’t see that as being a real green bond. You need to find things that are actually making a difference as far as environmental benefits -- reducing carbon footprints, LEED certification, demonstrate the social or environmental value we’re creating with the bond.”

The U.S. Social Bond Fund invests in charter school programs in Los Angeles, clean energy projects world wide, water desalinization and filtration projects in California and new public housing in New York.