Within the SDG Engagement High Yield Credit Fund, we seek two self-reinforcing objectives: performance and impact. In practice, this means we invest in issuers that have the willingness and ability to effect change that supports their credit profile. This is exemplified by our exposure to Barclays, one of the UK’s market-leading banks, which we have covered since 2004.
The investment case for Barclays is strong. With a strong risk-management framework and a conservative liquidity position, Barclays has also adopted a bondholder-friendly approach to exercising the call options on its debt – something we see as a key differentiating factor. Our analysts also note the bank’s good track record of managing regulatory ratios through volatile earnings periods.
In addition, we think that Barclays is particularly well placed to align its operations with the delivery of the SDGs through:
- Inclusive financial and lending products;
- Helping to fund decarbonisation efforts in the corporate sector; and
- Tackling broad corporate-culture weaknesses.
To find out more about the potential for Barclays to deliver SDG-aligned impact and our engagement progress to date, read the full engagement commentary.