Acronyms Galore! ALDC, Nasdaq, UB, UPM, MP Pension
This week NordSIP published its latest Insights report, “Translating ESG in Emerging Markets”, gleaned from a roundtable discussion of six professional investors discussing their experiences of sustainable investing in emerging markets spanning the topics of accountability, taxonomies, measurements, data quality and the dangers of greenwashing. But what lies on the investment horizon? Read here to find out more. NordSIP also spoke with ALDC Partnership founder and CEO Angelica Lips Da Cruz at a pre-launch event for its new project Innorbis, a data-driven algorithm designed to help drive large asset baskets towards more sustainable investments developed together with the Game Changer Global Initiative and other partners.
Elsewhere, Nasdaq launched the Nasdaq ESG Data Portal this week, a tool following on from the launch of its ESG Reporting Guide designed to show how listed companies in the Nordics and Baltics rank comparatively on key sustainability metrics, allowing investors to screen them based on their ESG credentials. The tool, though not a formal requirement, will go some way to addressing the common investor complaint of lacking ESG metric standardisation.
MP Pension, Denmark’s pension fund for academics employed in the public sector, has added to its list of countries it will divest from due to systematic human rights violations. Of particular focus is the exclusion of Saudi Arabia following the assassination of Washington Post journalist Jamal Khashoggi. The move means the redeployment of DKK 400mn, while other Danish pension funds are still sitting on their hands on the issue. Finnish forestry company UPM and United Bankers reached an agreement on a considerable forest estate transaction to UB funds and a long-term partnership, while Man Group stepped up its Responsible Investment efforts by announcing both an RI Fund Framework quantifying the RI focus across all Man Group funds and a proprietary RI Exclusion List of sectors and companies ineligible for its portfolios (NordSIP).
Heard on E-Street
Natixis IM subsidiary Ossiam launched Ossiam World ESG Machine Learning UCITS ETF, a smart-beta ETF using machine learning techniques with an ESG focus aiming to delivering the net total return of a selection of equities in developed markets through a machine learning algorithm selecting equities meeting ESG criteria. UniCredit also launched the UC MSCI European Green Bond EUR UCITS ETF, which enables investors to access a broadly diversified portfolio of liquid euro-denominated green bonds from European issuers (Investment Europe). Germany’s Evangelische Bank, which so far has primarily services institutions linked to protestant churches, launched EB-Sustainable Investment Management, with €4 billion in AUM upon launch in early December and spread across 90 mandates in Spezialfonds and retail funds (IPE).
Meanwhile, European institutional investors are joining a campaign spearheaded by Pictet to get global index providers to exclude controversial weapons manufacturers from mainstream indexes. The initiative has the backing of over 60 Swiss asset managers and is now being joined by over 20 institutional investors, including Bayerische Versogungskammer (BVK), Austrian VBV Pensionkasse and Dutch insurer ASR to take AUM represented by signatories to $4.8 trillion (IPE). On the opinion side, Vox’s Kelsey Piper takes a look at impact investing and finds evidence showing that it largely doesn’t work (Vox), while Bloomberg’s Rachel Evans suggests Wall Street’s embrace of ESG has come at a steep price, with SRI investors often ending up with costlier products that are the same and ESG losing its soul through greenwashing (Bloomberg Quint).
Famous Last Words
“It may be a perverse step forward to have Donald J. Trump as the global face of climate denial because so much of what he says is nonsense…[Conservative Republicans] are beginning to really worry that they’re going to be associated with that” – Former U.S. Vice President Al Gore at the UN Climate Summit COP24 in Katowice last week with a silver lining to see out the old year (TIME).
Hopefully that’s not another lump of coal in the Christmas stocking, then. Merry Christmas and a Happy – Green – New Year.
Your NordSIP team