Record Plc (LON:REC) Currency Management’s Emerging Markets Sustainable Finance (EMSF) strategy has marked its fourth anniversary, having been launched in June 2021 in partnership with UBS Wealth Management. The strategy was created to integrate emerging and frontier market currencies with bonds issued by Multilateral Development Banks (MDBs) and Development Finance Institutions (DFIs), aiming to support local currency financing and development initiatives.
Since inception, EMSF has reached approximately USD 1 billion in assets under management. It has directed around USD 963 million in private capital into DFI-issued bonds and executed USD 6.7 billion in trades across more than 30 currencies from emerging and frontier markets. In addition, USD 300 million has been allocated to targeted local currency transactions intended to generate impact in these markets.
The strategy actively assumes currency risk across a broad universe of emerging and frontier market currencies. This structure helps DFIs provide funding in local currencies, eliminating foreign exchange risk for borrowers and supporting sustainable development objectives through investment in MDB and DFI bonds.
Over the four-year period to June 2025, the strategy achieved a total return of 18.7%, outperforming both USD and local currency emerging market debt benchmarks while maintaining lower volatility. The firm emphasises that this performance supports the idea that financial returns and development impact can be achieved simultaneously.
Andreas Koester, CEO of EM and Frontier Investments, stated that private capital is increasingly needed to meet the UN Sustainable Development Goals by 2030, especially given constrained financial flows due to geopolitical conflicts and economic uncertainty. He cited estimates from the UN indicating a shortfall of USD 5–7 trillion annually in private sector funding. Koester believes that innovative sustainable financing mechanisms like EMSF can help close this gap by attracting private investment to development finance.
Looking forward, the Record EMSF team acknowledged ongoing geopolitical uncertainty but expressed optimism about emerging markets regaining investor interest. Renata Kreuzig, Fixed Income Portfolio Manager, and Canberk Yalcin, FX Portfolio Manager, reiterated the strategy’s focus on delivering both returns and positive socioeconomic outcomes. They also credited the MDB community and investors for their support.
The EMSF strategy reflects Record’s approach to combining financial objectives with measurable development impact through sustainable investment in emerging and frontier markets.
