“This [water] is a very significant issue for all investors,” said Fiona Reynolds, managing director at the U.N. Principles for Responsible Investment, based in London. “Water is central to pretty much everything that we invest in,” with food, beverage, apparel, retail and agriculture sectors the biggest users. “That is why, now that investors (have) really started to accept climate change as a risk — and that is still relatively new for (many) — we are seeing the increased focus on water. And I cannot see that going away.”
“This is partly because there is more being written about it,” said Chris Ralph, chief investment officer at St James’s Place. “But it’s also partly because people are observing what’s going on in society and realising that it’s something that they want to think about a bit more.”
In October the council became the first local authority in the county to call for a freeze to investment in fossil fuels, despite some heavy opposition. … Cllr Kay (Green, Nailsworth) said: “Make no mistake about it; it is an issue that affects our very lives. Unless we act to curtail fossil fuel use, we shall be dead.”
The motion: “Ethical investment is the pursuit of shareholder value” … A narrow majority of the audience—a mixture of students, academics and investment professionals—agreed with the motion before the debate started. That was overturned with a more substantial majority against the motion by the end.
ImpactAssets has released its 2016 impact investing showcase, the ImpactAssets 50 (IA 50), a free online resource for investors and financial advisors. The sixth annual list provides a diversified overview of fund managers representing private debt and equity investments that deliver social and environmental impact as well as financial returns. Fund managers included in the IA 50 2016 manage an estimated $10.6 billion in assets devoted to creating measurable, positive impact. IA 50 users can sort and filter across a range of asset classes (debt, private equity and real estate), geographies, size of funds, themes and more.
Following that 2016 consultation, we [the UN-supported Principles of Responsible Investment network of investors] have prioritised the nine key obstacles we will focus on in our work in 2017:
- Short-term investment objectives
- Attention to beneficiary interests
- Policymaker influence on markets
- Capture of government policy by vested interests
- Influence of brokers, ratings agencies, advisers and consultants on investment decisions
- Principal-agent relationships in the investment chain
- Cultures of financialisation and rent-seeking in market actors
- Investment incentives misaligned with sustainable economic development
- Investor processes, practices, capacities and competencies
—Fiona Reynolds, managing director of the Principles for Responsible Investment
“In the current political situation we will see what is realistic in the end,” said secretary general of the Mercator Research Institute Brigitte Knopf.
“Not so long ago, impact investments were a small part of most goals-based discussions with clients. Today, however, there are more ways for clients to align their values with their investments, and they are proactively seeking information and opportunities during conversations with advisors,” says Andy Sieg, head of Merrill Lynch Wealth Management.
Starting this year, a significant number of fund managers based all over the world will be among the approximately 12,000 companies that will be required to publish an annual statement under the transparency provisions of the UK Modern Slavery Act. The statement is required to describe the steps that were taken during the prior fiscal year to ensure that slavery and human trafficking is not taking place in any of the subject company’s supply chains and in its own business.
The latest report from data provider MSCI, 2017 ESG Trends to Watch, urges investors to act with vigilance and assert their influence as “owners rather than traders of an asset” in the year ahead … “The regulatory focus obscures the more fundamental risk: weather patterns can impact assets in a physical way,” This year, investors should increasingly look at the impact of the physical risk of climate change on asset values.