A study from Aite Group in December 2018 highlighted the growing demands for analytics and reporting in ESG and suggested that securities services providers could be primed to step into the space.
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Founded in 2012, Mirova is an affiliate of Natixis Investment Management, one of the biggest asset management companies in Europe. Mirova's investment approach is defined by the Sustainable Development Goals framework, as it enables to capture the contribution of an asset to environmental and social sustainability. As of September 30th, 2018, Mirova had USD 11.8 billion of assets under management.
Mirova only invests in countries and firms that contribute to the SDGs. To assess a security's alignment, the organization conducts bottom-up research involving security-level analysis of risk and opportunities, a life-cycle analysis to identify where the impact occurs, and finally an issue-level analysis to understand how specific themes affect the securities. Mirova seeks alignment with the Paris Agreement targets by monitoring the carbon footprint of the equities and bonds they hold in their portfolios. Beyond their investment choices, their approach involves a voting policy aligned to their values, which are accompanied by engagement procedures with issuers and public authorities.
Investment Week: ESG classified investment products account for more than $20trn in assets under management, or roughly a quarter of all professionally managed assets around the world, according to Forbes.
Top 1000 Funds: “The diamond-water paradox,” or “The Paradox of Value”, first pondered by the founder of modern economics, Adam Smith, in the 1700s (and featured much more recently on the US National Public Radio program Planet Money), is due to the widely held perception by investors that water is an abundant and endless resource with minimal value. But in a world of rising global water demand and climate-driven water stresses, that’s a risky bet. More than ever, water’s true value as a finite and precious resource is starting to be realised, and a growing number of investors are paying attention.
IPE: Dutch regulator De Nederlandsche Bank (DNB) has urged pension funds to map out social and ecological risks to their investments and minimise underlying problems if necessary.
All About Alpha: A new study by two scholars, an American and an Italian, presents evidence that financial markets are pricing the risk of reliance upon carbon, penalizing carbon-intensive assets and rewarding low-carbon assets.
IPE: The €409bn Dutch civil service scheme ABP has committed €500m to “green mortgages”, which come with a discount for energy-efficient residential property.
The discount would not only apply to purchased assets with the highest energy efficiency, but also to the mortgaged property after it has been converted to meet the requirements of energy label ‘A’ during the duration of the mortgage.
Investment Europe: Nordic investors have highlighted a new fixed income instrument designed to support the cleanup of the Baltic Sea, one of the most polluted parts of the world's oceans.
IPE: The trade body representing UK asset managers has launched an industry-wide consultation on sustainability and responsible investment in a bid to bring more clarity to the growing area of activity.
Global Custodian: Apex Group has teamed up with Institutional Shareholder Services (ISS) to develop an environmental, social and governance (ESG) reporting service to investment managers.
A study from Aite Group in December 2018 highlighted the growing demands for analytics and reporting in ESG and suggested that securities services providers could be primed to step into the space.
Triple Pundit: Impact investing is increasingly expected to close a looming funding gap to achieve the United Nations Sustainable Development Goals (SDGs). According to the U.N., achieving the SDGs by 2030 will require a total annual global spend of $5 trillion to $7 trillion, with an investment gap in developing countries of about $2.5 trillion. But how do the investors who are willing to step up to the plate know that their money is driving real impact?
Created under the Public Sector Pension Plans Act in 2000, the British Columbia Investment Management Corporation provides investment management services to Pension Plans, Government Bodies and other funds located in British Columbia. With CA$ 145.6 billion of assets under management as of March 31, 2018, BCI is one of the largest pension funds in Canada.
BCI believes that environmental, social and governance matters enables investors to better understand, manage and mitigate risks associated with long-term investments. Furthermore, to protect and grow the value of their client's funds, BCI has developed a Climate Action Plan to inform how it integrates climate considerations into their investment decisions, how it seeks new investment opportunities and engages with portfolio companies to increase their disclosure of climate-related risks they face. Finally, BCI was selected by the Bretton Woods II Initiative as one of the 25 most responsible asset allocators in the world for their commitment to investing responsibly.
Responsible Investing - Annual Report 2017
BCI's Climate Action Plan & Approach to the TCFD Recommendations
Amundi: Amundi’s new research on the impact of ESG investing on equity asset pricing finds that when an alpha strategy is massively implemented, it becomes a beta strategy.
CPA: While there’s widespread perception that female leaders bring a wealth of soft skills to their workplaces, the perception may be an oversimplification of the truth. For Sophia Tsui, senior vice-president and chief auditor at HSBC Canada, relational skills aren’t solely the domain of female leaders.
Pensions & Investments: The latest annual "Women on Boards" report, which has run since 2014 and assesses gender equality on public company boards, showed that the index provider's projection will take longer to reach 30% representation, which will now be 2029 instead of 2027 as predicted in 2015.
Forbes: In a surprisingly transparent move on Wednesday, Citigroup revealed that female employees globally earn 29% less than their male counterparts, while U.S. minorities earn 7% less than non-minority employees.
IPE: AP1, one of Sweden’s four main national pension buffer funds, has divested from a number of controversial industries following the introduction of new investment guidelines.
IPE: The £9bn (€10.1bn) Merseyside Pension Fund has invested £400m in a new worldwide equity climate fund, run by State Street Global Advisors.
The All World Equity Climate Balanced Multi-Factor Index fund was designed to align Merseyside’s responsible investment policy and activities with the goals of the 2015 Paris climate accord, the pension fund said.
Chief Investment Officer: New CalPERS Board member: “When ESG has nothing to do with maximizing returns and it is just for the sake of being socially conscious, it shouldn’t have a place in our retirement plan”.
IPE: The world’s third largest asset manager has written to more than 1,000 listed companies to tell them that corporate culture is top of its stewardship teams’ engagement agenda this year.
IPE: Eurosif, the Brussels-based pan-European sustainable investment organisation, has launched a strategic review to inform its future mandate, including how to best support implementation of EU sustainable finance measures, it announced today.
AP1 is one of five funds that act as a buffer in Sweden's national pension system. The Pension System was created in 1960, but it was not until 2001 that the current AP fund structure was established, allowing the AP funds to diversify their strategies. One of the key investment rules, set out by the Ministry of Finance, is to consider environmental and ethical matters without compromising the objective of attaining high returns. As of June 2018, AP1 had SEK 337.7 billion of assets under management (US$ 37.8 billion).
Through sustainable investments and active ownership, AP1 is able to create sustainable value for its trustees. To ensure that ESG issues are being considered across the organization, the Board of Directors provides continuous training on sustainability to their employees. Further, AP1, AP2, AP3 and AP4 collaborate through the Ethical Council to lead engagement with investee companies across issues linked to the Sustainable Development Goals. Finally, AP1 is active in many collaborative initiatives on responsible investing such as the UN PRI, the International Corporate Governance Network, Climate Action 100+, the Extractive Industries Transparency Initiative and many others.
Foresters Asset Management: For many years, investors have eschewed responsible investing, using the excuses that responsible investing is “too subjective” or “could hurt performance”. Both of these excuses are proving to be dated concepts.
Business Insider: The operator of The Weather Channel mobile app misled users who agreed to share their location information in exchange for personalized forecasts and alerts, and they instead unwittingly surrendered personal privacy when the company sold their data to third parties, City Attorney Michael Feuer said.
LA Times: When Google was revealed to have paid large severance packages to executives accused of sexual misconduct, outrage swelled, criticism piled on and employees stopped working and walked out of their offices.
Bloomberg: Pay for female staff at HSBC Holdings Plc’s U.K. business fell further behind male colleagues’ in the last year, according to new figures from the London-based bank.
Women at HSBC earned 61 percent less on average compared with male employees at the lender, a wider gap than the 59 percent difference the firm reported a year ago, already the biggest in the banking industry.
IPE: Norway’s NOK8.35trn (€852bn) sovereign wealth fund (SWF) should be allowed to invest at least 5% of its assets into renewable energy infrastructure, according to a report from think-tank Re-Define.
Citywire Selector: There was a time when ESG and emerging markets were a difficult, if not unrealistic, investment combination. Nowadays, sustainable investment is such an important and mainstream theme that those tapping developing economies are increasingly looking at these markets with ESG in mind.
Top 1000 Funds: Pensioenfonds Metaal en Techniek, the €72 billion ($82 billion) Dutch metal industry pension fund, has introduced a new index for its €16 billion ($18 billion) developed market equity portfolio, after two years of research and development. The index has been especially constructed to integrate the investment concerns of the fund’s beneficiaries, ESG factors and long-term returns. It employs a combination of active choices and a benchmark, bringing a new dynamic to the fund’s passive strategy.
IPE: Fitch Ratings has introduced a scoring system to show how environmental, social and corporate governance (ESG) factors affect the agency’s individual credit rating decisions.
Cision: Sustainalytics, a global leader in ESG and corporate governance research, ratings and analytics, today announced it has acquired GES International, a leading global provider of engagement, screening and fiduciary voting services to institutional investors. With the two firms uniting, pension funds and asset managers now have access to a full suite of trusted, high-quality pre- and post-investment products and services. The acquisition combines Sustainalytics' market leading ESG research and ratings with GES' extensive engagement and screening services.
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