Hargreaves adds Liontrust sustainable corporate bond fund to buy list

Taking the number of ESG strategies on the 71-strong Wealth Shortlist to six

Liontrust boosts fixed income team as AUM smashes £10bn

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Hargreaves Lansdown has included the Liontrust Sustainable Future Corporate Bond fund on its Wealth Shortlist.

Of the 71 funds on the buy list, just six are classified as ‘responsible’, which reflects little change since HL was criticised last year for being late to the ESG party.

In April, the inclusion of the Janus Henderson UK Responsible Income and the Trojan Ethical Income funds took the number of responsible investment strategies to five.

The latest addition from Liontrust now makes six.

The Wealth Shortlist, which launched in June 2020, is the latest iteration of HL’s best buy list. Its predecessor, the Wealth 50, was scrapped after just 16 months, following the implosion of Neil Woodford’s equity income fund, which had remained on its list of favourite funds right up until its suspension.

In addition to providing increased transparency and having funds on the list picked by an independent panel, it also made a U-turn on discounted fees for funds in the revamped buy list.

A team with skin in the game

The decision to add the Liontrust Sustainable Future Corporate Bond fund was based on its “experienced management team that is passionate about sustainability, avoiding ‘sin stocks’ and investing in bonds issued by companies making a positive environmental or social difference”, HL said.

Dominic Rowles, lead ESG analyst at the D2C platform, said: “It is managed by a team of four including Stuart Steven, who leads the team as head of sustainable future fixed income. He’s managed fixed income funds for over two decades, at a variety of companies. The four managers, and three other colleagues, form the small but focused Sustainable Future Fixed Income team. We like that the team invests their own money in the fund, and their incentives are aligned with those of investors.

“We’ve carried out a comprehensive analysis of the universe of responsible fixed income funds and have conviction in the Liontrust SF Corporate Bond fund. Following detailed analysis of the team’s track record and several meetings with them, our conviction has grown, and therefore we have added the fund to the Wealth Shortlist.

“We positively view Steven’s experience and expertise, and that of the wider Sustainable Future Fixed Income team, and believe they can deliver good long-term results for investors.”

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