Launches, Labels and Love
This week, NordSIP found inspiration in Paris where La Française‘s Equities CIO Laurent Jacquier-Laforge and Managing Director Patrick Rivière presented an update at a recent press day. We learned about the imminent launch of an investable carbon index, which idea is motivated by the identification of a tangible carbon factor, and the recent integration of Inflection Point allows for a better integration of E, S, and G in the firm’s investment process. NordSIP also sat down with Karine Jesiolowski, Senior Investment Specialist in Emerging Fixed Income and Member of the ESG Committee at Union Bancaire Privée (UBP), to discuss the rationale behind a new UBP product, the Emerging Market Sustainable High-Grade Corporate Bond fund. The idea was born of the phenomenon of the positive relationship between ESG and financial performance in fixed income and in emerging markets underpinned by academic studies, which is nevertheless belied by the fact that equities at present have a much higher proportion of sustainably invested assets than fixed income.
Alas, there was also more Danish dissemblance this week: Google, Apple and Facebook are threatening Danish CO2 emission reduction targets, but are not entirely to blame. The energy proposal floated by Denmark’s government in April promising to power half of Denmark’s energy consumption with renewable energy by 2030 neglected to mention agreements with the tech giants to build data centres in the country. Rather than reduce C02 emissions, the energy expended by these could cause emissions to rise by between 5 and 10%, compounded by the lack of clarity as to what else would make up for the corresponding emissions. The political opposition pounced, a general election being within sight.
Elsewhere, Norwegian life insurance company KLP launched KLP AksjeGlobal Mer Samfunnsansvar, Norway’s first Nordic Swan-Ecolabelled investment fund to invest pension savings in companies with serious sustainability profiles. It is the first index-linked fund to receive the label, and will invest in 750 companies complying with the label’s criteria for environmental, quality and health standards. SPP Fonder relaunched and renamed its SPP Global Top 100 fund into the SPP Global Solutions fund, a fossil-free equity fund anchoring its focus on three critical SDGs and reducing the number of companies it invests in to prioritise solutions-based companies. Jyske Bank released Munnypot, an online investment solution, that takes the innovative approach of using… people (!) as investment advisors at the ready to counsel on how to adjust investments customers make online as need arises, giving a whole new meaning to ‘responsible investment’ (and Munnypot was designed according to Jyske RI guidelines) (NordSIP).
Heard on E-Street
Danish pension fund ATP, one of the largest in Europe with $120 billion in AUM, is betting big on its investment in the newly launched DKK 4.1 billion Danish SDG Investment Fund, expecting 10-12% returns and reduced risk due to the government’s involvement, CEO Christian Hyldahl told Bloomberg (Bloomberg/The Star). Matt Levine asks what’s worse: pollution, or unpaid interns? The question is not hyperbole: how does one manage the tradeoff between maximising returns and social welfare, or between social responsibility objectives themselves (Bloomberg)? The Fortune Most Powerful Women summit held in London last week featured OECD chief of staff Gabriela Ramos, who noted that the business case for sustainability has profited from the toxic political environment, distrust in institutions and economic inequality resulting from globalisation (Fortune). The EU Strategy for the Baltic Sea Region has spurred projects to develop cross-border cooperation in crucial environmental areas that could help to achieve political commitments at the global level, such as the SDGs (EU Observer).
Question of the Week
What is one way to invest in gender equality?
Famous Last Words
“Some [ESG initiatives are] real, because there is real effort. Some of it is not real. Some of it is repackaging. When people talk about divesting from fossil fuels, one of the most frustrating things is seeing people jumping up and down and saying, “Oh, my strategy is fossil-free.” Of course—it was a biotech strategy. Now we’re seeing private-equity firms saying they’re impact investors, because they create jobs. But that’s not necessarily impact investing. It could be, depending on the type of jobs you are creating. Every dollar we spend or invest has impacts, whether they are positive or negative.“ – Matt Patsky, CEO of Trillium AM, which has $2.6 billion in all-sustainable AUM, on differences between saying and doing in a world that often confuses both (Barron’s).
But… “Summertime, and the living is easy..” Happy weekend and Glad Midsommar!
Your NordSIP team
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