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Webinar: First-time Fund Managers in Emerging Markets Bring a New Model to PE in Africa l Intentional Endowments Network, July 11th, 2017, 1:00 PM EDT
- Speak to any capital provider and they will tell you the standard private equity model is not structurally sound for the African ecosystem – as evident by the too few deals, limited human capital to run portfolio companies, and constrained levers for liquidity events. So, can the Find-Fund-Support value chain be deconstructed to build a new model for investing in Africa? In this webinar, four first-time fund managers will discuss how they tweaked different elements across the Find, Fund and Support value chain to create a new model for investment in Africa.
Effective Investing for the Long Term: Intentionality at Systems Levels l TIIP, July 12th, 2017, Boston, MA
- On July 12, 2017, The Investment Integration Project (TIIP) and the Center for Applied Research (CAR) at State Street, in conjunction with Ceres, will co-host an event that explores the intersection between efficiency and intentionality, and how the alignment of the two leads to effective investing.
- This Summit will focus on key factors that are changing the impact investing landscape. IEN will be partnering with Big Path, Ceres, and others to host a pre-Summit event focused on opportunities for investing in clean energy and climate solutions.
The SRI ConferenceThe SRI Conference l November 1-3, 2017, San Diego, CA
- The SRI Conference – on Sustainable, Responsible, Impact Investing serves thought leaders and investment professionals working in the ESG, Shareowner Engagement, and Impact Investing space. Together, we are catalyzing the shift to a more socially equitable and environmentally sustainable future. We deliver education and inspiration — in between legendary networking opportunities.
Sustainable, Responsible, Impact & ESG Investing
Bloomberg Brief l Sustainable Finance
- This week's Bloomberg Brief highlights how electric cars will outsell fossil-fuel powered vehicles within two decades, according to a new Bloomberg New Energy Finance forecast; Solar company shares have taken a curious turn upward since President Donald Trump announced plans to withdraw from the Paris Agreement; Big investors lose patience with unresponsive corporate directors; and Chicago has the greenest office buildings.
- A number of disconnects exist between investors and credit-rating agencies when it comes to environmental, social and governance factors, said a new report by the Principles for Responsible Investment. The report outlines how investors and credit-rating agencies are taking ESG factors into account in credit risk analysis. The report said a particular disconnect exists when it comes to views on the time horizons over which ESG factors should be considered. "Investors and (rating agencies) struggle to agree on what is a reasonable time horizon to consider," said the report. "Investors tend to align their time horizons with their investment objectives: some buy and hold long-term bonds until maturity (while) others trade more frequently."
ESG Investment Strategies Will Disappear (And For Good Reasons) l Financial Advisor
- Although socially responsible investing is getting popular, in the future investors will no longer need a separate investment bucket for companies with socially responsible practices in place, says Columbia Threadneedle’s Ed Kerschner. Instead, companies that have good returns and dividends will have good environmental, social and governance practices in place, says Kerschner, chief portfolio strategist for Columbia Threadneedle, a global asset manager with $467 billion in client assets. “There are still people who believe you have to sacrifice returns to invest in socially responsible companies, but that has been proved false,” Kerschner says. Columbia Threadneedle’s investments that take ESG issues into consideration outperform the S&P average.
The Value of SDG-Focused Business Models l Eco Business
- What does the chief executive of the world’s largest consumer goods company have to say about the business case of the Sustainable Development Goals? Listen to Unilever’s CEO Paul Polman in this exclusive interview.
- More companies are now reporting the impact they have on the environment and society. But where is the value in doing this, and what effect does it have in the real world? Eco-Business asked the new chief executive of Global Reporting Initiative (GRI), Tim Mohin.
Leading Institutional Investors Back $412m First Close of New Climate Investor One Facility (Subscription) l Responsible Investor
- Leading institutional investors have backed the first close of a new “blended finance” climate investment facility called Climate Investor One (CIO) with $412m (€365.6m). CIO is the inaugural initiative of Climate Fund Managers (CFM), which was set up in October last year as a joint venture between Dutch development bank FMO and Phoenix InfraWorks, the Cape Town-based infrastructure specialist headed by former Macquarie Africa Chairman Andrew Johnstone. It the first of an intended series of initiatives designed to combat the effects of climate change. Targeting Africa, Asia and Latin America, CIO will focus on solar, wind and ‘run-of-river’ hydro renewable energy projects.
- Investors are catching up with corporates in appreciating sustainability as a concept that can help unlock opportunities rather than just mitigate risk, according to the chief executive of RobecoSAM. Speaking at a Responsible Investor conference in London earlier this month, Aris Prepoudis – who took over as CEO in January – said investors’ approach to sustainability was unfolding in a similar way to how the corporate sector embraced the concept. Speaking to IPE after the conference, Prepoudis said that although the focus among asset owners was still on risk management he was confident more would appreciate the opportunities that came from sustainability investing.
- In this article, John Hale, Head of Sustainability Research at Morningstar, answers two questions One has to do with the definition: What exactly is meant by sustainable investing? The second has to do with the availability of appropriate funds: Are there enough viable choices to build a diversified sustainable portfolio?
- BlackRock, the world’s largest asset manager, recently conducted a survey that was discussed by Anne Ackerley in The BlackRock Blog. They that found that “67% of millennials say they want investments to reflect their social and environments values.” By the way, the article went on to say that, “… for women, it’s 76%.” We refer to this type of investing as “Impact Investing” and it is becoming a way of life for the next generation of investors. The question is; if you don’t have tons of money to invest, how can you get started?
Investment Manager News
Mirova in Talks to Acquire Impact Investing Boutique l Investment Europe
- SRI-focused asset manager Mirova, part of Natixis Global Asset Management, has entered into exclusive negotiations to purchase a majority stake in London-based impact investment boutique Althelia Ecosphere. Mirova stated that the projected acquisition of Althelia aims to create a European platform operating from London and Paris and dedicated to natural capital investing. The platform would provide investors with access to investment solutions addressing global environmental challenges such as climate change, protection of landscapes, biodiversity, soil and marine resources.
- Reynders, McVeigh Capital Management, an investment management firm with a focus on socially responsible investing (SRI), announced today its partnership with environmental, social, and governance (ESG) optimization technology provider, OWLshares. The partnership gives Reynders, McVeigh access to a wide set of proprietary ESG data and underscores the firm’s commitment to defining more precise performance metrics for its investment research. By adding the ability to optimize the value of ESG data in its own research process, Reynders, McVeigh has evolved its capabilities for analyzing the underlying factors that contribute to operating performance in different companies across sectors.
World’s Largest Pension Fund Selects Three ESG Indices for $9 Billion Investments l Chief Investment Officer
- Japan’s Government Pension Investment Fund (GPIF), the world’s largest pension fund, announced Monday that it will shift 3% of its passive domestic equity investments (roughly $8.8 billion) into environmental, social, and governance (ESG) indices. The first of the $1.2 trillion fund’s picks include MSCI’s “Empowering Women” WIN index, in favor of its gender equality agenda. The index focuses on companies that “encourage more women to enter or return to the workforce,” ranking companies according to the gender balance of staff from their new hires to their executive board.
- ESG research and ratings organisation Sustainalytics is expanding its Sydney office and building a team to better serve Australia and New Zealand, which is the second-fastest growing region for responsible investment, after Japan. Sustainalytics is a multinational firm with 13 offices worldwide, employing 300 team members and more than 170 in-house research analysts with multidisciplinary expertise across 42 sectors.
- Traditionally, socially-responsible investing meant buying stocks of companies that weren’t in the alcohol, gambling, gun or tobacco business or that helped the environment, as well as mutual funds or exchange-traded funds (ETFs) that owned them. But lately, the idea has spread to bonds — specifically “green” bonds used by companies and municipalities for projects with eco-friendly or climate benefits such as initiatives for clean water, renewable energy, energy efficiency or habitat restoration.
Climate Risk, Science & Regulation
- European institutional investors have welcomed the final recommendations of the high-level climate disclosure task force set in train by Bank of England Governor Mark Carney. The panel – the Task Force on Climate-related Financial Disclosure (TCFD) under the auspices of the Financial Stability Board – released the report today and it was hailed by the Institutional Investors Group on Climate Change (IIGCC). The TCFD aimed to devise a principles-based framework for voluntary disclosure, balancing the needs of the users of disclosures (investors) with the challenges faced by the preparers (companies). It has developed a voluntary framework for companies to disclose climate-related information in their financial filings.
- Investors are slowly starting to push companies to reduce their carbon footprint and help the world meet targets on limiting global warming that were agreed in the 2015 Paris climate talks. Energy firms have faced shareholder demands to do more to curb carbon emissions, while some pension funds are demanding more commitment to climate goals from firms they invest in. Yet progress has still been modest since the Paris deal agreed by almost 200 nations came into force in November last year, aiming to limit global warming to 2 degrees Celsius (3.6 Fahrenheit) above pre-industrial times. "Lots of investors are looking to align their investments with a 2 degrees world. It's just at what pace they all get there," said Fiona Reynolds, managing director at the United Nations-backed Principles for Responsible Investment.
Africa High on G20 Summit Agenda l Graphic Online
- Africa was for the first time high on the Agenda of the 2017 G20 Summit, which was held in Germany recently. The Summit brought together nine heads of government, including Ghana’s President, Nana Addo Dankwa Akufo-Addo, heads of the World Bank, the International Monetary Fund (IMF) and the African Development Bank (ADB), as well as the Federal Chancellor of Germany, Dr Angela Merkel, German Minister of Finance, Dr Wolfgang Schäuble, and the German Development Minister, Dr Gerd Müller. The various state officials discussed issues of central importance to the continent’s future, as well as forging a new partnership between the 20 most important industrialised and emerging countries and Africa.
- For many Canadian investors it’s hard to imagine owning a strong portfolio that doesn’t contain any oil stocks, which is understandable. Oil is so tightly linked to Canadian markets and the economy that it’s now ingrained into the psyche of investors who rely on their portfolios to deliver returns. However, a new study has made discoveries that could debunk that myth. The research shows that portfolios holding a significant concentration of heavy carbon-emitting companies can actually put an investor’s funds at risk.
- This platform includes a new database with the world’s biggest coal plant developer companies disclosed.
- Dutch pension investor APG has teamed up with HgCapital’s Vasa Vind to build Sweden’s largest onshore wind power project – and says it will take a “leading role” in initiating new projects. APG and Vasa, a portfolio company of HgCapital’s Renewable Power Partners 2 fund, said they have started construction of the 288MW Åskalen project in Jämtland, central Sweden. The project will comprise 80 Vestas V136 3.6MW turbines and total construction investment will amount to approximately €300m, and commissioning will be completed in 2020 delivering a total power production close to 1TWh/year, equivalent to 50,000 Swedish households.
- For Volvo the internal combustion engine has run its course. In the face of competition from upstarts like Tesla Inc., which begins production this week of its new mass-market Model 3 electric battery-powered family car, the Chinese-owned automotive group on Wednesday said all new Volvo models from 2019 would be either fully electric or a hybrid. Volvo is the first major auto maker to abandon the technology that has powered the industry for more than a century.
- Sustainable energy finance may maintain momentum even as President Trump moves to protect fossil fuel interests. On June 1, the same day the president announced the U.S. would withdraw from the Paris Agreement, an international accord aimed at reducing carbon emissions, Gurtin Municipal Bond Management unveiled a Municipal Social Advancement strategy designed in part to meet investor demand for sustainable investment products.
General Higher Education Endowment News
Divest-Invest: Foundations Urged to Back Climate Solutions While Divesting from Fossil Fuels l Democracy Now
Harvard Close to Selling $1.6B in RE Assets l The Real Deal
- Harvard University will soon sell off its real estate, private equity and venture capital assets as part of a plan to shed more than $2 billion worth of holdings from its endowment. The company that handles the university’s $35.7 billion endowment, Harvard Management Company, has committed to sell the interests in real estate funds to Landmark Partners, Bloomberg reported, citing sources. The assets are worth around $1.6 billion, according to the publication.
- This article explores how the country’s elite universities, sitting atop multibillion-dollar endowments, venture into far more exotic and potentially risky realms than individual investors as they chase higher returns to fund day-to-day operations, from scholarships for students to salaries for superstar professors, and where they put that money.
Fossil Fuel Divestment
- The Wallace Global Fund recently awarded the Standing Rock Sioux Tribe the inaugural Henry A. Wallace Award and a $1 million investment in renewable energy projects led by the tribe. In this Q&A Amy Godman talks to the fund’s executive director, Ellen Dorsey, about the "Divest-Invest" movement.
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