- Boston Common Asset Management, Responsible Sourcing Network, Trillium Asset Management, Mercy Investment Services, and US SIF invite you to sign an investor statement expressing support for continued implementation of Section 1502 (Conflict Minerals Disclosure) of the Dodd Frank Act. Last week, a proposed Executive Order was leaked which ordered that the required disclosure be put on hold for two years as other options were reviewed. Please sign on by completing the form by Friday, February 17th.
2017 ICCR Proxy Resolutions and Voting Guide l Interfaith Center on Corporate Responsibility, 2017
- This guide presents ICCR member-sponsored resolutions — whether as lead or co-filer — for the 2017 proxy season, as of January 27. If you are a shareholder, we invite you to read through it, review our members’ argumentation and support those resolutions you can. Bearing in mind that any abstention is counted as a vote for management by default, we strongly urge investors to be active shareowners and vote all their proxies as an important exercise of shareholder rights, whenever possible.
- The webinar will provide an overview of the value of proxy voting and additional forms of engagement for endowments that are involved in commingled funds through an outsourced CIO – including the current landscape, trends, specific issues, and why it is important for investors. Guidelines and opportunities of how to take action will also be provided.
- Find out why leading global investors are putting increasing pressure on US managers to adopt stricter environmental, social and governance (ESG) principles as they consider investing in private equity and other alternative asset classes. Building on the success of the longest-running ESG event in Europe, the Responsible Investment Forum comes to New York to bring together the most sophisticated LPs, GPs and service providers to discuss why, when, and how your firm should be implementing an effective ESG strategy.
- The Impact Investing Forum will look at many of the asset classes that encompass this space. We invite you to join us and meet top influencers, experienced investors, money managers, and service providers that are leading the charge in this ever growing space. Themes of defining impact investing, portfolio construction, asset class opportunities, and the role of the investor are just a few of the stimulating topics to be covered at this event. This conference will exclusively feature dialogue driven panel discussions led by consultants and family offices.
- The Impact Capitalism Summit is the Largest Convening of Impact Investors Globally. This year at the Impact Capitalism Summit in Chicago we will explore the progress of leading impact investment portfolios, discover the latest innovations across sectors, themes and asset classes, and identify the steps needed to harness the power of capital markets to build a sustainable, fair and just economy where opportunity and prosperity are shared by all.
Sustainable / ESG Investing
Bloomberg Brief l Sustainable Finance
This week's Bloomberg Brief highlights how some U.S. companies are anticipating a new wave of tax breaks under President Donald Trump, while some of their investors say they are not receiving enough information about how any windfalls will be used; some European green bonds are trading at a premium; the London Stock Exchange Group has a new ESG guide; Sustainability professionals say Trump is their black swan; and in a Q&A, Calyxt CEO Federico Tripodi says gene editing can boost food supply without GMO headaches.
- The Generation Foundation, 2° Investing Initiative, Mercer, Morgan Stanley and S&P Global Ratings are to co-launch two reports later this month exploring the potential of misallocation of capital over the long-term due to the inability of the finance sector to capture long-term risks with short-term risk-assessment frameworks.
A New Era of Sustainable Investing Emerges l Barron's
- President Donald Trump’s flurry of policy directives has fueled activism across the country. It may also light a fire under some investors focused on sustainable business practices. In the 12 weeks since the election, investors have put $383 million into ESG stock funds, according to EPFR Global. The political backdrop “could have a galvanizing effect, as investors look for ways to more explicitly support sustainable ideas,” says Jon Hale, head of sustainability research at Morningstar.
- Materiality is anchored in the idea that specific risks or opportunities can be identified through sophisticated ESG analysis. This analysis can discount as obvious a risk as the imposition of a carbon-pricing mechanism, or as subtle as the importance of gender and race diversity in the boardroom, C-suite, and the employee base. This opinion piece looks at the accumulating evidence that you can make many while also making a better world.
- Investors are actively demanding more information about different components of ESG investments. During a GreenBiz 17 program Wednesday, Dmitri Sedov, vice president of innovation and digital strategy at S&P Global, said their acquisition of Trucost will help solve a gap between the demand for sustainable investing and the supply of these investments. Sedov said one of the first steps to help solve this imbalance is to create a unified system that looks at environmental risks similar to the way S&P Global Ratings look at credit risk.
- Mission-related investing, which includes impact investing and ESG investing, is gaining significant momentum among non-profit institutional investors, according to a survey by global investment firm Cambridge Associates. The most common thematic focus among impact investors is the environment and climate change, with healthcare, housing, job creation, and education also cited as areas of interest by respondents in Mission-Related Investing: Current Practices and Views of Non-Profit Investors.
- A coalition of over 130 investors representing over $685 Billion in assets under management called on banks financing the Dakota Access Pipeline (DAPL) to address or support the Standing Rock Sioux Tribe’s request to reroute the pipeline and avoid their treaty territory. Lead investor Boston Common Asset Management is joined by Storebrand Asset Management and Calvert Research and Management, with support from First Peoples Worldwide—along with CalPERS and the Comptroller of the City of New York.
- The task of meeting the Sustainable Development Goals, or SDGs, are beyond the capabilities and interests of governments, which means universities around the world have a unique role to play, according to world-renowned economist Dr Jeffrey D Sachs. "I do think the academic and university sector have a unique role to play; I do not believe the SDGs can be achieved without the university sector,” said Sachs when addressing the World Sustainability Forum held in Cape Town, South Africa last month.
- The world’s biggest investors are joining forces to unite against Donald Trump in the fight against climate change. As G20 foreign ministers meet on Thursday to prepare for a climate change summit in Hamburg in July, managers of funds with assets totalling more than $2.8 trillion - more than the entire annual GDP of the UK - called for leading economies to phase out fossil fuel subsidies within the next three years to avert a catastrophe.
- Greenhouse gas emissions in the United States declined by 2.2 percent between 2014 and 2015, federal officials reported on Tuesday. The EPA attributed the overall decline to lower carbon dioxide emissions from burning fossil fuels, which itself came about because of less coal consumption in favor of natural gas, warmer winter weather that decreased heating fuel demand and lower electricity demand overall.
- Canada’s Arctic glaciers have become a major contributor to sea level change, according to glaciologists at the University of California, Irvine (UCI). The Queen Elizabeth Islands, which include Ellesmere Island and dozens more, saw surface melt on its ice caps and glaciers accelerate by 900 per cent over the course of a decade. It went from three gigatons per year in 2005 to 30 gigatons per year in 2015, the research shows.
- Institutional and private sector forces will continue to drive global efforts to reduce carbon emissions, even if US climate policy is moderated or reversed by the new US administration, Moody's Investors Service said in a report titled "Environmental Risks: Shift in US Climate Policy Would Not Stall Global Efforts to Reduce Carbon Emissions" this week. "We believe that powerful structural forces at play, including robust institutional and private sector momentum, will continue to drive global sustainable and climate agendas regardless of the direction of US federal climate policy," said Rahul Ghosh, the report's co-author.
- A major speech today by the Australian financial regulator APRA focusing on climate change and prudential risk has been warmly welcomed by investors. The address by Geoff Summerhayes, Executive Board Member of the Australian Prudential Regulation Authority, which oversees banks and most of the superannuation industry, was made at the Insurance Council of Australia and noted how climate risks are ‘financial’ in nature. The wide-ranging speech touched on stranded assets and the system-wide implications of climate change.
- New Energy Outlook (NEO) is Bloomberg New Energy Finance's annual long-term view of how the world's power markets will evolve in the future. This year’s edition sees $11.4 trillion investment in global power generation capacity over 25 years, with electric vehicles boosting electricity demand by 8% in 2040. The levelised costs of generation per MWh for onshore wind will fall 41% by 2040, and solar photovoltaics by 60%, making these two technologies the cheapest ways of producing electricity in many countries during the 2020s and in most of the world in the 2030s.
- College students decades ago protested endowment investments in South Africa during apartheid, and more recently, fossil fuels. Now there’s a new target: hedge funds. Wright State is among a dozen Ohio schools targeted in a report to be published Friday by Hedge Clippers urging them to sell stakes in hedge funds because they don’t make good financial sense. The survey examines the role of hedge funds in the economy, and touched on another point that’s important to students: since individual hedge fund holdings aren’t always disclosed, it’s hard to determine if the investments run counter to their school’s ethics or values.
- A new report finds that state funding for higher education continues to show growth overall, but each state has its own tale to tell. Support for higher education in state budgets rose by 3.4 percent across the country from the 2015-16 to 2016-17 fiscal years, preliminary data from the latest Grapevine survey shows. The compilation of state-taxpayer support is jointly produced by the Center for the Study of Education Policy at Illinois State University and the State Higher Education Executive Officers Association, but does not include more in-depth factors like inflation and enrollment.
- A study released last week by the Council for Aid to Education found that university endowment funds pulled in $41bn worth of donations in 2016, a shade higher than the total for 2015. That would be more of a cause for celebration if returns had not dropped 2 per cent. A further chill to college money managers may come from Trumpian tax reform that could be unkind to charity.
- The overall UO endowment grew 5.5 percent last year compared with an average loss of 2.2 percent for peer endowments, according to the annual survey by the National Association of College and University Business Officers and the money manager Commonfund.
- Hedge funds once seemed crucial to helping the College of Wooster boost the value of its endowment. Now school officials have “increasing skepticism" of active management. Hedge funds are the classic example of super-active management. Wooster’s decision to slash hedge fund holdings to 25 percent of its portfolio from almost half in the past five years is part of a wider trend of institutions, including public pension funds, questioning the value of hedge fund investments.
- Like other traditional hedge funds, Harvard Management Co. has been plagued with problems associated with the recent investment climate of low returns, investor fatigue, and more. As part of an effort to turn the tide on its endowment's profits, managers at the fund are cutting roughly half of the 230 jobs and making significant internal restructuring plans. At the same time, some leaders at the fund are looking to this as a chance to leave Harvard in search of new opportunities in the hedge fund world.
- Case Western Reserve University Chief Investment Officer Sally Staley has retired, making her at least the fourth woman departing from the helm of a university endowment in recent months. At least a half-dozen schools have announced leadership changes at their endowments following lagging performance. Women run endowments for about 15 percent of the richest 100 colleges, according to data compiled by Bloomberg.
- Activists packed this week's CalPERS Board of administration meeting, urging the retirement fund to divest from the controversial Dakota Access Pipeline. The CalPERS board is considering an Assembly bill that would compel it to divest from the project, as well as with any business that is helping to fund or finance it. The activists plan to hand the board about 52,000 signatures they collected from people who want the fund to divest from the project.
- A student group at Quebec City’s Laval University has been campaigning for their school to divest from fossil fuels for three months. This week they got yes for an answer, when Laval became the first Canadian university to commit to divest from all fossil fuel holdings.
- The University of British Columbia will exclude fossil fuel companies from its low-carbon investment fund, a move being applauded by a campus group that has been pushing for divestment. The university has rejected calls to divest entirely from fossil fuels, but last year it established the $10-million Sustainable Future Fund to invest in companies with low carbon dioxide emissions. On Tuesday, the school said in an emailed statement that its board of governors voted to approve a framework for the fund that would see it invested in a fossil fuel-free portfolio managed by investment firm Jarislowsky Fraser.
- London’s largest public pension fund is facing renewed calls to divest from fossil fuel-related holdings as it emerged it held companies involved in the Dakota Access Pipeline. The London Pension Fund Authority (LPFA) had holdings in three companies involved in the controversial US development, according to portfolio data from 30 September 2016 circulated by campaign group Divest London. The investments were bonds issued by Energy Transfer Partners, ConocoPhillips, and Marathon Petroleum, worth roughly £393,000 collectively.
- The London Pensions Fund Authority is under pressure from London Mayor Sadiq Khan to divest entirely from fossil fuel holdings, but says it prefers working with companies and fund managers over divesting.
- Refuel our Future, a student-led fossil fuel divestment group at Hopkins, celebrated Valentine’s Day on Tuesday by handing out cards to raise awareness for Global Divestment Day and the University’s investment in fossil fuels. The group has a divestment proposal currently under consideration by the Public Interest Investment Advisory Committee (PIIAC), which was reconvened near the end of last semester.
- The controversial topic of divestment of the USF Foundation will be sent to the student body after the Student Government (SG) Supreme Court deemed a student referendum constitutional. The referendum, titled “USF Divest From Fossil Fuels, Private Prisons and Companies Complicit in Human Rights Violations,” calls for the Foundation to end investments in companies that have a direct connection with contributing to the use of fossil fuels, funding private prisons and investing “in human rights violations in Palestine and Yemen.”
- In this opinion the piece, the author argues that instead of divesting from fossil fuels, Cambridge University should use the money to invest in reducing the cost of renewables.
- In this piece the author argues that each day the university remains invested in U.S. Bank and Wells Fargo it is a blemish on their reputation. They say that University of Iowa (UI) President Bruce Harreld must take a stand and actively represent the values an institution of higher education such as the UI holds, and the university cannot claim to be a liberal-arts school devoted to fostering diversity when it continues to fund forms of oppression.
- In this Open Letter to Boston University (BU) President Brown, student members of the BU divestment movement make the case for why there should be an open dialogue on fossil fuel divestment on their campus.
- About 80 ralliers organized outside the JPMorgan Chase Bank on Sixth Street on Monday to demand that residents and the city alike divest from the financial titan. The lunch-hour protest called on the city to follow Seattle's lead in divesting. Along with other big-name banks, Chase has loaned over $300 million to Energy Transfer Partners, the company backing the Dakota Access Pipeline and the planned Trans-Pecos Pipeline in West Texas. The city currently holds a $1.16 million contract with the bank.
- ESG investment principles have been gaining increased prominence in recent years with exchange traded funds providers helping increase ESG accessibility to all investors. The SPDR MSCI ACWI Low Carbon Target ETF and the iShares MSCI ACWI Low Carbon Target ETF are two of the more successful ESG ETFs. CRBN and LOWC are up an average of 4.6% this year. The two ETFs target the MSCI ACWI Low Carbon Target Index, which tries to address carbon exposure by overweighting companies with low carbon emissions relative to sales and per dollar of market capitalization, compared to the broader market. Both ETFs were created for the U.N. Joint Staff Pension Fund.
- PKH, the NOK22bn (€2.4bn) Norwegian pension fund for health authorities, has seeded a global high yield ESG themed bond fund run by BlueBay Asset Management. The fund was kicked off by a mandate from PKH for an ESG strategy for their global bond portfolio, according to My-Linh Ngo, ESG specialist at BlueBay. The main requirement from PKH was for the fund to comply with the exclusion criteria applied by Norges Bank Investment Management (NBIM) for Norway’s Government Pension Fund Global, Ngo told IPE. It covers companies involved with controversial weapons, tobacco, and coal-based energy.