On August 3, 2015 Tundra Fonder, an independent fund manager specializing in frontier markets, launched the Tundra Sustainable Frontier Fund. According to Emerging Markets ESG, this is the first known frontier fund investing with an ESG methodology.
According to a press release distributed by the firm, “Tundra Sustainable Frontier Fund will invest in several countries, including Bangladesh, Kenya, Nigeria, Pakistan, Sri Lanka and Vietnam. The fund will have an ESG (environmental, social, governance) focus and will not invest in alcohol, commercial gambling, pornography, tobacco and weapons, or in companies that violate the UN conventions.
Two analysts, one with previous experience at Transparency International, have been recruited to focus on sustainable investments in frontier markets. In parallel, Ethix SRI Advisors in Stockholm have been engaged as an ESG research partner to assure the fund’s sustainability profile.”
“Tundra is the world’s first fund management company to combine investments in frontier markets with a sustainability focus. And there is great interest. Three public institutions have already guaranteed seeding in the fund,” said Jon Scheiber, Tundra Fonder’s CEO.
Johan Elmquist, one of the founders of Tundra and Portfolio Manager of the Fund, described the fund’s ESG methodology as follows, “The Tundra Sustainable Frontier Fund will apply two layers in the ESG process to approach the frontier universe: a negative ethical screening and a norms-based screening based on UN principles, the second in combination with internal resources. The internal analysis is crucial, especially in the short term, since ESG rating agencies currently do not provide in-depth coverage of frontier markets.”
Since it was founded in October 2011, Tundra Fonder has grown rapidly; at present it has assets under management of SEK 1.7 billion (US $206 million). Tundra is based in Stockholm and has a research office in Karachi, Pakistan.
On its website, you can read more about Tundra Fonder and the Tundra Sustainability Frontier Fund.