Launch of a new Sustainability-Linked Bond offering by Border to Coast Pensions Partnership
Leeds-based LGPS pool, Border to Coast, has announced plans to launch a new sustainability-linked bond fund next year. The fund, focused on green, social, and sustainability (GSS) bonds, aims to provide access to investment opportunities in these debt instruments for its partner local government pension funds.
With a total of around £55 billion (€63 billion) in local government pension assets under management, Border to Coast is collaborating with 11 Local Government Pension Funds for this initiative. The fund will be overseen by Border to Coast Pensions Partnership, which directly manages investments for the participating funds.
Border to Coast's focus on sustainable finance is evident in this new fund launch, as it integrates environmental and social investment mandates within its portfolio management. The intended launch timeline is next year (2026), with preparations underway as of mid-2025.
The pool's responsible investment manager will be responsible for the development and implementation of responsible investment strategies for its fixed income offerings. This includes monitoring third-party verification providers and assessing the credibility of issuer-level sustainability disclosures.
The pool is yet to disclose whether the new fund will be internally managed or involve allocations to third-party funds. At the time of the report, Border to Coast currently offers three fixed income funds, with allocations to Sterling-denominated Index-Linked Bonds, Investment-Grade Credit, and Multi-asset Credit.
The green or sustainability-linked market is primarily dominated by European issuers, with Europe on track to become the largest green bond issuer worldwide. The issuance of sustainability-linked debt has decreased slightly since its peak in 2021, but the market might be on track to recover and pick up again. According to World Bank data, over $1trn in sustainability-linked debt has been issued as of last year.
The new sustainability-linked bond fund from Border to Coast is part of its ongoing efforts to promote sustainable investing. As the world continues to grapple with climate change and social issues, funds like this one play a crucial role in aligning investments with ESG and sustainability goals.
The new fund, focused on green, social, and sustainability (GSS) bonds, aligns with Border to Coast's focus on sustainable finance and will be part of their business strategy, as they integrate environmental and social investment mandates within their fixed income portfolio management. With plans to launch next year, Border to Coast, a Leeds-based LGPS pool managing approximately £55 billion in local government pension assets, will collaborate with 11 Local Government Pension Funds in the development and implementation of responsible investment strategies, also considering third-party verification providers and issuer-level sustainability disclosures.
