Ontario Teachers' Pension Plan (OTPP) is Canada's largest single-profession pension plan with $189.5 billion in net assets. They pay pensions and invest plan assets on behalf of 323,000 working and retired teachers. Since their establishment as an independent organization in 1990, OTPP have built an international reputation for innovation and leadership in investment management and member services.
Ontario Teachers' Pension Plan thinks of responsible investing as a journey because ideas, terminology and tools are evolving, and so are practices. OTPP's ESG analysis is becoming more systematic across the pension plan and they know more about the potential impact of ESG factors on financial returns than in the past. OTPP's investment teams buy and sell assets daily in carrying out their investment strategies and they integrate ESG analysis into their decisions.
The Task Force on Climate-related Financial Disclosures (TCFD) launched its TCFD Knowledge Hub in collaboration with Climate Disclosure Standards Board (CDSB). The TCFD Knowledge Hub is a platform designed to help organizations implement the TCFD recommendations by providing over 300 relevant insights, tools and resources. Resources include existing legislation and regulations, frameworks, standards, guidance, research papers, tools and webinars. All resources either directly address the TCFD recommendations or are related to themes or specific requirements within the TCFD recommendations.
In this edition of Global Macro Shifts, Franklin Templeton Investments research-based briefing on global economies, the Templeton Global Macro team, led by Dr. Michael Hasenstab, reviews the importance of ESG factors in macroeconomic analysis and the sovereign asset class, highlighting several case studies to illustrate the team’s thoughts on ESG.
More information on energy efficiency and the environmental impact of real estate investments is urgently needed if the industry is to move forward in reducing carbon emissions, according to a panel of investors at the IPE Real Estate Conference & Awards.
Change in the asset and wealth management industry (the ‘AWM industry’) is accelerating at an exponential rate. Although the industry is set for growth, asset and wealth managers must become business revolutionaries, even disruptors, if they’re to survive and prosper.
AQR presents an empirical investigation of the potential link between ESG exposures of companies and the statistical risk of their equity. They investigate both contemporaneous risk forecasts and what ESG characteristics convey about future risks that are not captured by statistical risk models.
Shareholders want more from their companies than earnings growth.
“Investors are now paying much more attention to a company’s culture and what we’re doing from a social standpoint,” Susan Salka, chief executive officer of AMN Healthcare Services Inc., said at the Bloomberg Business of Equality summit in New York.
Alberta Investment Management Corporation (AIMCo) is one of Canada’s largest and most diversified institutional investment managers with more than $100 billion of assets under management (AUM). AIMCo was established in 2008 as a Crown Corporation to provide investment management services for specified pension, endowment and government funds in the Province of Alberta. AIMCo's 32 clients are increasingly focused on responsible investing and its impact on investment risk and return.
Partout dans le monde, un grand nombre de caisse de retraite et de fonds de dotation ainsi que d’autres investisseurs institutionnels relèvent le défi d’aligner leurs portefeuilles sur les principes de l’investissement responsable.
Sustainalytics, a leading provider of ESG and corporate governance research, ratings and analysis, launched its new Carbon Risk Ratings, which measure companies’ exposure to and management of material carbon risks. The Carbon Risk Rating captures a variety of carbon signals in a single, quantitative assessment designed to support investment analysis, decision-making and reporting. The Sustainalytics’ solution provides insights related to material investment risk that cannot be calculated through the traditional approach of carbon footprinting.
After Nike Inc. ousted a handful of male executives for behavior issues over the past few months, some media reports tied the departures to the #MeToo movement and its revelations of sexual harassment and assault. Interviews with more than a dozen former Nike employees, including senior executives, however, paint a picture of a workplace contaminated by a different behavior: corporate bullying. The workers say the sneaker giant could be a bruising place for both men and women, and that females did bullying, too. On May 8, Nike signaled as much when it confirmed four more exits stemming from an internal misconduct inquiry, including the departure of a woman with more than 20 years at the company.
iA Financial Group has adopted a sustainable development policy. The company introduced this policy in its ‘2017 Social Responsibility Report’. Earlier this year, its board of directors officially adopted a sustainable development policy, thus, clearly expressing the company’s commitment to creating not only economic value, but societal value as well. It has set out seven guidelines. They are to ensure the financial wellbeing of its clients; effectively manage risks; follow high standards of governance; actively contribute to its communities; manage environmental impacts; create a rewarding work environment; and practice responsible sourcing.
Industry experts have broadly welcomed the move by the UK government to consult on the legal duties of trustees with regard to environmental, social and governance (ESG) risks, but warned any prospective rules or regulations must not be overly prescriptive.
The Canada Pension Plan Investment Board (CPPIB) is Canada's largest institutional investor, with assets in excess of C$300 billion.
CCPIB have recently published their 2017 Sustainable Investing Report.
Mark Machin, President and Chief Executive Officer, states: “The fact is, sustainable investing is the right approach for an organization that aims to deliver strong returns over decades. Given CPPIB’s exceptionally long investment horizon, ESG factors can be significant drivers – or barriers – to the success of the enterprises in which we invest.”
Canada's La Caisse De Dépôt et Placement du Québec (CDPQ) was the subject of last week's investor ESG spotlight. This week, La Caisse published its first annual Stewardship Investing Report. This report provides an overview of la Caisse’s strategic directions for stewardship investing and details the concrete measures it has taken on several key issues, including climate change, corporate governance, women in business and international taxation.
State Street Global Advisors, PGIM, and other managers are making environmental, social, and governance (ESG) criteria part of their overall investment processes, but the head of Ontario Teachers' Pension Plan reminded an audience Tuesday that the real goal remains being able to pay pensions.
Thirty Canadian and international financial institutions and pension funds representing approximately CAD $1.2 trillion of assets under management on October 26, 2017, issued a joint Declaration of Institutional Investors on Climate-Related Financial Risks, calling on publicly traded companies in Canada to commit to enhanced disclosure on their exposure to climate change risks, and the measures they are taking to manage them. The Declaration is supported in principle by 13 organizations.
Across the world, individual and institutional investors seek attractive financial returns while helping to achieve a positive impact on the communities around them. With growing concerns over climate change and global warming, geopolitical instability and uncertainty in financial markets, this has become even more pressing.
Eighteen years ago, a small group of climate enthusiasts from the worlds of finance and investment formed the Carbon Disclosure Project, now known as CDP, from a windowless basement in London. Their hugely ambitious aim was to encourage every business worldwide to report climate change-related data, such as their greenhouse-gas emissions, to investors.
By signing the ESG in Credit Ratings Statement, credit rating agencies and fixed income investors commit to incorporating ESG into credit ratings and analysis in a systematic and transparent way. To date, the statement is supported by more than 130 investors (with over US$26trn in collective AUM) and 15 credit rating agencies (CRAs).
Environmental, Social and Governance (ESG) topics are permeating the lexicons of society, corporations, regulators, and the investment community alike. We gather data points and anecdotes of rising ESG focus beyond the usual suspects - including earnings transcripts, social media and asset manager initiatives - as evidence of the growing relevance for investors.
Alison Schneider, director of responsible investment at AIMCo; Jane Ambachtsheer, a partner and chair for responsible investment at Mercer; and Michael Jantzi, chief executive officer at Sustainalytics; will be among the featured speakers at the ‘2018 RIA Conference.’ Schneider will discuss engagement and the UN SDGs while Ambachtsheer will speak on ‘Global Financial Stability: Climate Disclosure to the Rescue?’ Jantzi will deliver a keynote address. Other sessions will examine ESG integration in alternative assets, managing climate risk across asset classes, and innovative disruption and responsible investment. It takes place June 4 and 5 in Toronto.
Created in 1965, La Caisse de Dépôt et Placement du Québec manages almost C$300 billion, making it one of the world's largest investors. La Caisse has been active to highlight the importance of E, S and G factors and has worked to evolve the organization's investment policies to consider ESG criteria.
We are pleased to provide links to key documents outlining CDPQ's responsible investing and climate change initiatives.
(Reuters) - Avenue Capital Group LLC, a New York-based investment firm with $9.4 billion in assets under management, plans to launch a fund this year that will focus on so-called impact credit investments, according to a person familiar with the matter.
The CFA Institute now provides various materials to support increasing awareness of ESG criteria throughout the investment process.
The Institute's Handbook on Sustainable Investments, prepared in conjunction with the CFA Society of Switzerland and Swiss Sustainable Finance, provides examples and case studies of different approaches to sustainable investment across various asset classes.
More than 1,000 people died in Bangladesh’s worst industrial accident when the eight-storey Rana Plaza garment factory near Dhaka collapsed in 2013. Many of the workers, aware that the factory was unsafe, had gone on strike in protest but had returned to the ill-fated building because they had been given an ultimatum to come back to work or lose their jobs.
For investors, tragic events such as the Rana Plaza disaster provide a catalyst to reform the investments processes and the criteria for evaluating investment outcomes.
This research report is the result of a partnership between the World Bank Group and Government Pension Investment Fund (GPIF) of Japan, initiated by the World Bank Group’s President, Jim Yong Kim, and GPIF’s Chief Investment Officer, Hiro Mizuno. The aim is to collaborate on initiatives that promote strategies for including environmental, social and governance (ESG) criteria in investment decisions across different asset classes. Ultimately, the goal is to direct more capital towards sustainable investments and leverage the private sector to achieve the scale of investment needed to meet the Sustainable Development Goals.
BlackRock, the world’s largest asset management group, has called for regulators to be tasked with setting corporate governance standards rather than relying on index providers to screen prospective or existing members of their benchmarks.
European pension funds are among a $1trn-strong group of institutional investors calling on companies to set greenhouse gas emission targets that will help achieve the goals of the Paris agreement on climate change.
Castle Hall note: further information on the Investor Decarbonization Initiative is available here.
As our first ESG spotlight, we are pleased to highlight the University of Toronto Asset Management (“UTAM”), with combined pension and endowment assets of approximately C$10 billion.
In 2017, UTAM published their first Responsible Investing Report and published a Responsible Investing Policy. The institution also appointed BMO Asset Management to identify ESG risks in select companies worldwide, signed the Montreal Carbon Pledge, and became a participant in the Climate Action 100+ group.
It’s been so encouraging to see the progress women have been making across so many industries these past few years. There’s better female representation on corporate boards... And while some sectors are more advanced than others, even traditionally male-dominated industries, like alternative investments, are making some encouraging moves in the right direction.
Managing climate risk is imperative for all investors. For those investors who are comfortable with some exposure to carbon intensive sectors, imposing carbon constraints may be an effective approach to achieving a lower-carbon risk profile with a return profile in line with or better than the benchmark.
Fiduciary Investors Symposium: An estimated $3.4 trillion is invested in renewable energy but that is set to grow to much more. The compelling case for investing in renewable energy comprises: consumer demand, revolutionary technology such as electric cars, changing corporate behaviour, and galvanizing factors such as the sustainable development goals (SDGs), a panel of experts has argued.
A paper by the Canadian Human Resources Professionals Association (HRPA) found 40 per cent of HRPA members surveyed reported that their workplace still takes a reactive approach to sexual harassment and 17 per cent report witnessing an employee being sexually harassed or assaulted. ‘Doing our Duty: Preventing Sexual Harassment in the Workplace’ also found close to 20 per cent of members reported an increase in sexual harassment claims in recent months. Information from broader industry can inform development of sexual harassment policies in the asset management industry.
First State Super, one of Australia’s largest super funds, will delve deeper into the emerging risk of franchise models in Australia to ensure its investments don’t support rights abuses.
Castle Hall comment: an interesting initiative from a leading institutional investor to "look through" investment structures to the underlying activities of portfolio companies.