TBLI Insights and a Guardian’s New Horizons
NordSIP spent time with Nadine Viel Lamare, Head of Sustainable Value Creation at the Swedish buffer pension fund AP1 at last week’s TBLI conference by, among other things, playing an intriguing card game developed by entrepreneurs TwinStrength presented at the conference. Nadine was celebrating her last days with the fund, where she has held a number of positions including Head of Corporate Communication, prior to her next move. Still at TBLI, we followed a panel featuring Alecta’s Carina Silberg, Storebrand’s Jan Erik Saugerstad, AP1’s Mikael Angberg and Barclays Wealth’s Damian Payiatakis, who discussed if asset owners can achieve a 100% ESG portfolio.
Meanwhile, a new bill to govern sustainability requirements for AP funds 1-4 is under scrutiny, with critics saying it does not go far enough in light of continued investments by the funds in fossil fuel industries amounting to billions of crowns.
In an excerpt from Sustainable Fixed Income, NordSIP’s latest report, UN PRI senior consultant Carmen Nuzzo argues that consideration of ESG factors in fixed income is gathering pace and catching up with equities, with ESG beginning to feature heavily in bond evaluation despite obstacles that have delayed its consideration, such as complexity and a lack of engagement culture.
Swedish insurance and pensions company SPP was the only company to receive top marks in all insurance categories in insurer Max Matthiessen’s latest annual report, which guides savers seeking sustainable management of their pension funds. The overall trend for the year is positive. Finally, Malmö-based robo-advisory and digital portfolio management service BetterWealth launched an investment service with portfolios containing a larger proportion of sustainable investments and less exposure to unsustainable and controversial industries (NordSIP).
Heard on E-Street
The Sustainable Stock Exchanges Initiative organised a global dialogue on sustainable capital markets and published a report presenting actions for and examples of securities regulators supporting the SDGs (IISD). The European Parliament’s Committee of Economic and Monetary Affairs endorsed a decision making it mandatory for all financial market participants – including banks – to disclose sustainability risks and impacts of their portfolio, a move welcomed by NGOs as a step further in the EU’s greening of its financial system (Euractiv).
Nao Sustainable Asset Management launched its first fund, Nao Europa Sostenible, a European equity fund aiming to invest in companies with mid to long-term revaluation prospects that meet ESG investment criteria, while Wellington Management launched a UCITS compliant climate strategy that will invest globally in companies tackling sustainability or climate risks to be managed by Alan Hsu (Investment Europe). Research from Pensioen Pro found that Dutch pension funds have a limited stake in locally issued corporate green bonds to the tune of €800 million (IPE), while the Cerulli Edge report finds that ESG is taking root in fixed income, with demand increasing and prompting further launches of ESG products (Investment Europe).
Famous Last Words
“Just because asset managers consider ESG measures in investment decisions, it does not mean they give them much weight. It is perfectly plausible, though unlikely, for an asset manager to say they have integrated ESG fully, without altering a single investment decision they make… There is no real benchmark for what ESG integration means in practice. Even with the best of intentions, changes to investment decisions after integrating ESG will be highly variable and may not be material in most cases. Our research at Re-Define shows that the real difference in how asset managers allocate capital before and after they have signed up to PRI or one of the other alphabet soup of principles in the responsible, ESG and sustainable investment domain is significantly less than 1%” – ReDefine director Sony Kapoor in an eye-opening editorial on the substance – or lack thereof – of ESG integration.
Always question. Happy weekend,
Your NordSIP team
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