Boston-based Putnam Investments is repurposing two of its multi-cap funds to be environmental, social and governance (ESG) focused funds by March, the investment management firm announced today.
The Putnam Multi-Cap Growth Fund, with $4.3 billion in assets, will transition to the Putnam Sustainable Leaders Fund. According to a statement, the Sustainable Leaders Fund will concentrate on companies that demonstrate sustainable business practices.
The Putnam Multi-Cap Value Fund, with $450 million in assets, will become the Putnam Sustainable Future Fund. This fund will focus on companies whose products and solutions add to the sustainability of economic, social and environmental development.
Putnam’s chief investment officer Aaron Cooper describes the two funds as “pure dedicated ESG products.” The firm aims to help investors capitalize on a range of market dynamics like how a company’s stocks perform better when companies make better management and policy decisions, according to Cooper.
“The case really has been built that when you incorporate ESG materials into your practice, it can enhance returns,” said Cooper. Cooper also added that ESG is one method to protect capital since most companies that go bankrupt tend to be poorly performing ESG companies.
To echo the belief of intentional investing throughout their practice, Putnam has been increasingly integrating ESG strategies across its investment platform, according to the release.
“These ESG offerings are a powerful recognition by our firm that clients and investors, who are increasingly intrigued by sustainable investing, stand to benefit from focused strategies in this area in the years ahead,” said Cooper in a statement.
Katherine Collins will manage both funds. Stephanie Henderson will be the assistant portfolio manager for the Sustainable Future Fund, and co-head of equities Shep Perkins will join Collins in managing the Sustainable Leaders Fund.