Joining the Party

    Amazon founder Jeff Bezos made the headlines this week as he caved to the pressure and set aside a fraction of his fortune to save the world. Meanwhile, in Sweden, state pension AP1 finally succeeded in finding a successor to its now-infamous CEO, who had to leave for a failure to disclose personal trades. Kristin Magnusson Bernard is due to join the party soon, but not yet (no later than September 1st).

    Also in Sweden, mutual insurance Länsförsäkringar announced a tripling of its investments in green and sustainable bonds to just below SEK10 billion (about €900m). In the sustainable bond space, UBS funded a new iShare ETF which tracks an index of bonds issued by multilateral development banks. This type of debt provides an attractive way for clients to diversify portfolio risk while contributing to the SDGs, the Swiss bank has found. Already in 2019, the bank offered a similar product, which we explored in our SDG-focused Handbook.

    Finnish pension Ilmarinen has also chosen an iShare ETF in a US$600m investment to track the MSCI EM ESG Leaders Index, following a US$800m investment in a similar ETF targeting the US market, in the first half of 2019.

    Last but not least, hedge funds are definitely joining the party, whether they want it or not. According to a survey led by AIMA, CAIA, CREATE-Research and KPMG, 55% of institutional investors include ESG considerations as part of the due diligence process before allocating to a hedge fund manager. The report also reveals that 59% of hedge fund managers are either at the ‘mature’ or ‘in progress’ stage of implementing ESG, an advance mainly driven by institutional investors.

    Image by Free-Photos from Pixabay

    Aline Reichenberg Gustafsson, CFA
    Aline Reichenberg Gustafsson, CFA
    Aline Reichenberg Gustafsson, CFA is Editor-in-Chief for NordSIP and Managing Director for Big Green Tree Media. She has 18 years of experience in the asset management industry in Stockholm, London and Geneva, including as a long/short equity hedge fund portfolio manager, and buy-side analyst, but also as CFO and COO in several asset management firms. Aline holds an MBA from Harvard Business School and a License in Economic Sciences from the University of Geneva.

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