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Threadneedle UK Social Bond Fund

Connecting social and financial outcomes that aim for consistent growth

The Threadneedle UK Social Bond Fund is a UK credit fund that targets positive social outcomes, seeking to unlock the full potential of corporate bonds to deliver both financial and social returns.

The Fund aims to achieve total return (by way of income and capital appreciation) through investments which support socially beneficial activities and developments, in eight areas: affordable housing, education, employment and training, health and social care, financial inclusion, community services, transport and communication infrastructure, utilities and the environment.

The Big Issue Group acts as a social adviser to the fund, reviewing and challenging the Fund’s investments from a social performance perspective.

Overview

Strength in partnership

Our strong reputation across both bonds and social investment is enhanced by our partnership with The Big Issue Group, social entrepreneurs and a leader and innovator in backing sustainable social businesses.

Consistent track record in social bond investing

We have managed outcomes-focused social bond strategies for over five years and have delivered strong risk-adjusted returns for our investors.

Collaborative approach

The first Fund to unlock the full potential of bonds to deliver both financial returns and positive social outcomes. Using a dynamic social assessment methodology to guide investment decisions, the portfolio manager actively sources assets that combine clear social benefits with sound financial attributes.
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Overview

Strength in partnership

Our strong reputation across both bonds and social investment is enhanced by our partnership with The Big Issue Group, social entrepreneurs and a leader and innovator in backing sustainable social businesses.

Consistent track record in social bond investing

We have managed outcomes-focused social bond strategies for over five years and have delivered strong risk-adjusted returns for our investors.

Collaborative approach

The first Fund to unlock the full potential of bonds to deliver both financial returns and positive social outcomes. Using a dynamic social assessment methodology to guide investment decisions, the portfolio manager actively sources assets that combine clear social benefits with sound financial attributes.
Square mile
Sri logo

PDF

Social Investment Guidelines

UN Sustainable Development Goals and our themes

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Approach

We use an outcomes-focused approach to deliver both social and financial returns. We first identify bonds that conform to eight key social fields set by Big Issue Invest to form a social universe of over 700 securities. Eligible investments are then ranked by our Responsible Investment team to evaluate the ‘social intensity’ of qualifying bonds, with each security is ranked as high, medium or low social intensity.

This is not a simple box-ticking exercise, but involves a three-dimensional approach to the social implications of each issue. At the most basic level, bonds invested in promise measurable outcomes in one of the eight social fields; next, our analysis draws on a number of factors to judge the social outcome. Here, geography is a key driver – where the outcome occurs is important. The next level of detail looks at localities, using indicators which show where deprivation levels are most severe.

Our investment grade credit team evaluates these bonds using our established credit research process to ensure that investment ideas meet the necessary financial and liquidity requirements for inclusion within the portfolio. The portfolio manager has ultimate responsibility for final portfolio construction and targets a third of the exposures in each of the three high, medium and low social intensity buckets.

Threadneedle uk social bond

Note: Use of the SDG logos does not imply UN endorsement.

Social performance

Read our Annual Social Performance Report, produced in conjunction with The Big Issue Group, to see how we are making a difference and meeting our impact objective of supporting a more inclusive and sustainable development in the UK.

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Annual Social Performance Report 2020

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Annual Social Performance Report 2019

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Annual Social Performance Report 2018

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Annual Social Performance Report 2017

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Annual Social Performance Report 2016

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Annual Social Performance Report 2015

Insights

22 November 2020

Responsible Investment Quarterly - Q3 2020

View the Q3 2020 edition of the Responsible Investment team's Quarterly Report
Read time - 1 min
22 February 2019

Ben Kelly

Senior Thematic Analyst

How airports are flying high: a social perspective

Holding airport bonds in our social strategies often raises questions. But aviation brings huge social and economic benefits, and is making great environmental strides.
Read time - 5 min
5 June 2018

The future of food: Eat or be eaten

The food value chain is vital to the success of many economies and global financial markets, as well as sustainable development.
Read time - 7 min

Explore fund details

Fund Manager

Simon Bond
Director of Responsible Investment Portfolio Management
Tammie Tang
Deputy Portfolio Manager, Fixed Income

Important Information​

Key risk

Past performance is not a guide to future returns and the fund may not achieve its investment objective. Your capital is at risk. The value of investments can fall as well as rise and investors might not get back the sum originally invested. The fund holds assets which could prove difficult to sell. The fund may have to lower the selling price, sell other investments or forego more appealing investment opportunities. Most bond and cash funds offer limited capital growth potential and an income that is not linked to inflation. Inflation is likely to affect the value of capital and income over time. Changes in interest rates are likely to affect the fund’s value. In general, as interest rates rise, the price of a fixed rate bond will fall, and vice versa. The investment policy of the fund allows it to invest in derivatives for the purposes of reducing risk or minimising the cost of transactions. The fund invests in securities whose value would be significantly affected if the issuer either refused to pay or was unable to pay or perceived to be unable to pay. The fund holds assets which could prove difficult to sell. The fund may have to lower the selling price, sell other investments or forego more appealing investment opportunities. Most bond and cash funds offer limited capital growth potential and an income that is not linked to inflation. Inflation is likely to affect the value of capital and income over time. Changes in interest rates are likely to affect the fund’s value. In general, as interest rates rise, the price of a fixed rate bond will fall, and vice versa. The investment policy of the fund allows it to invest in derivatives for the purposes of reducing risk or minimising the cost of transactions. Please read the Key Investor Information Document and the Fund Prospectus if considering investing.

Threadneedle Opportunity Investment Funds ICVC (“TOIF”) is an open-ended investment company structured as an umbrella company, incorporated in England and Wales, authorised and regulated in the UK by the Financial Conduct Authority (FCA) as a Non – UCITS scheme. This material is for information only and does not constitute an offer or solicitation of an order to buy or sell any securities or other financial instruments, or to provide investment advice or services. The dealing price may include a dilution adjustment where the fund experiences large inflows and outflows of investment. Further details are available in the Prospectus. Subscriptions to a Fund may only be made on the basis of the current Prospectus and the Key Investor Information Document, as well as the latest annual or interim reports and the applicable terms & conditions. Please refer to the ‘Risk Factors’ section of the Prospectus for all risks applicable to investing in any fund and specifically this Fund. The above documents are available in English only and may be obtained free of charge on request from Threadneedle Investments at PO Box 10033, Chelmsford, Essex CM99 2AL. Issued by Threadneedle Investment Services Limited. Registered in England and Wales, Registered No. 3701768, Cannon Place, 78 Cannon Street, London EC4N 6AG, United Kingdom. Authorised and regulated in the UK by the Financial Conduct Authority (FCA). Columbia Threadneedle Investments is the global brand name of the Columbia and Threadneedle group of companies.