The Pie Climate Friendly Fund will launch on Tuesday.

The Fund will invest predominantly in companies with lower exposure to carbon emissions and fossil fuel reserves.

These companies will be part of low-carbon benchmarks or selected with the assistance of third-party research providers, specialising in carbon risk and climate impact.

The fund will invest in any vehicles of any size, whereas its other funds focus specifically on small-cap investments.

Investments will include direct equities, ETFs and it may also hold cash.

Chief executive Mike Taylor said that would increase the options available within the Pie Funds stable for advisers, who might want to limit the amount of client money in small-cap-specific vehicles.

He said Pie was rolling out an wider environmental, social and governance (ESG) policy for its funds. It had started with this fund but would cover all investments.

Initial screening work had shown there were no holdings that would need to be sold down, he said. Pie had recently established its own ESG committee.

The fund charges performance fees of 0.48% of net asset value and an annual management fee of 1.25%. The performance fee is linked to the fund’s high-water mark and is not associated with the performance of a benchmark.

The minimum initial investment is $25,000.

Taylor said there was investor demand for such a product. Pie Funds was often asked when it was going to launch an “ethical” fund – but he said describing a fund as “ethical” was difficult because it was not a term that could be quantified.