Sustainability and Climate Integration in Fixed-Income Portfolios: Part 2
Mentioned in this paper:
MSCI USD IG Core Climate Paris Aligned Corporate Bond Index | BarraOne® | MSCI Implied Temperature Rise
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This paper applies the theoretical framework from Part 1 of this guide to two concrete corporate bond mandates — one passive (core) and one active (satellite) — over a simulated holding period using real data from January to December 2025. By tracing both mandates through the full investment process, from objective setting and portfolio construction to risk management and reporting, the paper demonstrates how sustainability and climate data can serve different investment strategies and how index-based approaches and active security selection can each deliver on both financial and climate objectives.
Data as of April 30, 2026. Data generated using BarraOne® performance attribution report using MSCI Multi-Asset Class (MAC) Factor Model over a simulated 12-month holding period between January and December 2025. “Common Factor” represents the portion of the total return attributable to changes in market-wide fixed-income risk and return drivers, such as changes in interest rates. “Asset Specific” is the portion of the total return that cannot be explained by the common factors. “Carry” is the return from holding the securities over the period. Past performance does not indicate future returns.
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