Norwegian divestments, autonomy demands and low-carbon indices
This week, Norway’s €829 billion Sovereign Wealth Fund announced a plan under consideration to divest its petroleum stocks, a move that could entail a dump of as much as $40 billion. The initiative has more to do with hedging risk than environmental concerns, however. Kames Capital Head of ESG Research Ryan Smith explains to NordSIP how Kames has designed an investment process that allows it to identify unexpected sustainable investments, such as its pick of U.S. flooring designer Mohawk. The Swedish buffer funds of the state pension system AP1 and AP2 have reacted to the finance ministry’s package of new rule changes by demanding further autonomy to make direct investments. Elsewhere, Natixis Global Asset Management is rebranding its name to Natixis Investment Managers, part of its “New Dimensions” three-year strategic plan to expand growing asset classes while developing RI and active management solutions. Finally, Gothenburg was named “the most sustainable city in the world” as per the results of the 2017 Global Destination Sustainability Index, topping the rankings for the second consecutive year (NordSIP).
In the second of its series of tutorial products, NordSIP looks at low-carbon indices and suggests how they fit into the bigger sustainable investment picture.
Heard on E-Street
Foreign Policy suggests in a compelling argument that contrary to popular perception, Germany is a “coal-burning, gas-guzzling climate change hypocrite”, while Environmental Voter Project founder Nathaniel Stinnett finds signs that 2018 could be the year of the climate voter in the U.S. (Huffington Post). The Economist ran a special issue suggesting that stopping the flow of carbon dioxide into the atmosphere will not suffice because emissions cannot be cut fast enough to keep the total stock of greenhouse gases sufficiently small to limit the rise in temperature – ways must be found of scrubbing it from the air, too.
Quote of the Week
“We have to avoid falling into these four perverse attitudes, which certainly do not help honest research and sincere and productive dialogue on building the future of our planet: negation, indifference, resignation, and trust in inadequate solutions” – Pope Francis, suggesting the world’s current industrial system will have to be completely overhauled if climate change is to be seriously confronted at COP23 in Bonn (cleantechnica.com).
Question of the Week
Which NOK600 billion Norwegian financial services giant recently launched a sustainable global equity fund?
Famous Last Words
“’ESG’ will be around as kind of the description of how you do all this. I think ‘responsible investing’ might sort of go by the wayside. I just don’t think it has a great connotation either in terms of its history, plus it kind of puts people on the defensive if you are not interested in investing this way – are you being irresponsible? It’s just one of those terms I just don’t think is very resonant with people as opposed to ‘sustainable investing’ and ‘impact’” – Jon Hale, Morningstar director of sustainable investing research, on sorting through the alphabet soup of sustainable terms.
Have a good weekend,
Your NordSIP team
Image: (c) NosorogUA-shutterstock