Solidarity fund


A solidarity fund is an investment fund, which acquires a commitment with social entities. Through these commitments, the managing entity undertakes to deliver part of the profits or commissions generated for social purposes.

A solidarity fund is an investment fund that maintains a series of agreements with non-profit organizations or of a solidarity and social nature. Through these agreements, the entity in charge of managing the investment fund undertakes to assign or deliver part of the profits generated by the fund, as well as part of the commissions charged to the fund's clients. These donations or deliveries are used for tasks or actions that have a specific social purpose.

These funds are authorized by the relevant regulatory bodies, as well as classified within a fund relationship with a distinction that distinguishes them from the rest. This distinction can be found in the characteristics of the fund itself, when accessing the information provided by the regulatory body.

Characteristics of a solidarity fund

There is no consensus on the characteristics of a solidarity fund. These funds can be fixed, variable or mixed income. However, the regulatory body does require a series of conditions for these funds to be considered solidarity funds.

Among the characteristics, the following basic principles should be highlighted:

  • Invest in assets, whose issuing companies are committed to social purposes.
  • Make donations or deliveries that have a specific social purpose.
  • Invest in companies that comply with current regulations on sustainability and the environment.
  • Collaborate with agencies and organizations of a social nature.
  • Invest in companies that do not violate human rights, such as child labor or exploitation.

All these tasks, in the case of Spain, must be recorded and detailed in the information brochure that the fund publishes to the regulatory body. In addition, the entity must verify that all these actions, as well as the values ‚Äč‚Äčthat make up the fund, are true. In addition, they meet the criteria required to be considered a solidarity fund.

Types of solidarity fund

As with the characteristics, there is no fixed relationship on the types of funds that could be considered solidarity. Whether these are considered solidarity depends, to a large extent, on aspects such as the management or the actions carried out within the manager itself. These being collected some basic principles required to be able to detail that the fund is a solidarity fund.

However, depending on the tasks they perform, we can distinguish solidarity funds by meeting the requirements of the regulatory body to obtain the distinction.

These requirements that characterize the funds would be:

  • Those funds that, being solidarity, carry out management with securities that meet the criteria required by the regulatory body. Thus integrating, in its portfolio, securities of companies that comply with all current regulations and are committed to the planet.
  • On the other hand, funds that allocate part of the profits or commissions to activities with social purposes. That is to say, funds that, in collaboration with organizations and NGOs, are in charge of allocating part of their capital to actions that have a specific social purpose.

How do I know if a fund is a solidarity fund?

As we mentioned earlier, all solidarity funds are distinguished by regulatory entities. These have a seal or a distinction that allows identifying that these funds are solidarity funds. Thus, in Spain, solidarity funds are marked as such in the information brochure that the manager must make available to the regulatory body. In this case, the National Securities Market Commission (CNMV).

In other countries, as in Spain, solidarity funds collect their distinction in information brochures. Brochures that, as is the case in Spain, must be submitted to the relevant regulatory bodies, in order to make this information available to investors and potential interested in investing in this type of fund.

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