Mistra, The Swedish Foundation for Strategic Environmental Research, has published the results of its 2011 review of external asset managers. The review, which was carried out by onValues on behalf of Mistra for the seventh consecutive year, examined the progress of Mistra's asset managers in integrating environmental, social and governance (ESG) issues into investment decision-making and active ownership. Following the review, onValues presented Mistra's Asset Management Committee with results and recommendations, and provided constructive feedback to the asset managers.
In 2011 Mistra's managers made notable progress in ESG integration and the development of more-sophisticated active ownership practices, particularly in the area of company engagement. The 2011 review also focused especially on Mistra's new emerging market and private equity managers. The report, downloadable below, provides details on manager progress in these and other areas of sustainable investment.
Mistra's SEK 2.7 billion (€300 million) endowment is invested through thirteen mandates and funds managed by nine different asset managers. Mistra explicitly requires the managers to take account of ESG issues.
Download the public report
«Mistra Foundation Asset Management Review 2011»
One of Switzerland's largest pension schemes, the Swiss Post Pension Fund, recently implemented a CHF130m microfinance debt mandate based on onValues advice. This is probably one of the largest investments in microfinance ever done by a pension fund globally. Rolf Maurer, Investment Manager at the fund, told Responsible-investor.com that the mandate had been awarded as a long-term investment: "We began taking a closer look after our investment committee directed us to do so in 2010," he added. The fund carried out the initial research on the asset class via its own internal investment team. Maurer told Responsible-investor.com: "From the beginning it was clear to us that the investment had to be worth it from a social and financial standpoint. The internal study revealed that this was the case, both in terms of risk/return and especially diversification. This is why we went ahead". The fund subsequently hired onValues, working in cooperation with Ecofin, the Zurich-based investment consultant, to carry out the manager search for the mandate.
A group of PRI signatories and Global Compact LEAD companies are joining forces to improve the communication of ESG value drivers beyond reporting and make sure that sustainability performance is rewarded by financial markets. The goal of this project is to develop and refine content and process innovation around the communication of ESG value drivers at the company investor interface. Specialist consultancies Contrast Capital and onValues are providing project management and research support to this project.
Ivo Knoepfel won the award for Outstanding Contribution to Development in ESG at the TBLI Conference Europe 2011, which took place in London on November 10th. Citing his selection, the judges panel said, "Mr. Knoepfel stands out by the continuous innovation that he brings to the market. He is always independent with a sharp mind and a good sense for new developments." Also shortlisted for the award were James Gifford, Executive Director of the UN-backed Principles for Responsible Investment, Reto Ringger founder of SAM Sustainable Asset Management and Globalance Bank, and the organization Sustainable Finance Geneva.
In the coming weeks, onValues Managing Director Ivo Knoepfel will participate as a speaker or panellist in a range of investor meetings and conferences. This will allow us to share and refine our views on key investment trends with other investors and stakeholders. The events include:
- 24 October: "Doppelte Dividende", oekom, Zürich
- 25 October: "4th Schweizer Leadership Pensions Forum", FT Business, Zürich
- 31 October: "Nachhaltig in Rohstoffe investieren?", Forum Nachhaltige Geldanlagen, Zürich
- 1 November: "Swiss Equity Cleantech Day", Swiss Equity, Zürich
- 4 November: "Rating Responsible Finance", The Rating Initiative, Luxembourg.
onValues has released The Responsible Investor's Guide to Commodities, a report aimed to help institutional investors navigate the environmental, social and governance challenges of commodities-related investments. Investors gain exposure to commodities in various ways: derivatives, physical commodities, real assets such as forests and farmland, and debt and equity of companies active in the sector. The report launched today offers specific best-practice recommendations for each of those asset classes and also comments on the strategic allocation between commodities-related assets from the perspective of a responsible investor.
The role of investors in commodities markets will be increasingly critical and scrutinized as resource scarcity and demand growth continue into the future. This report aims to provide a starting point for investors to consider how to adopt practices that preserve their "license to invest" and contribute to long-term social and economic goals.
onValues received support for its commodities research over the past two years from the Swiss Federal Department of Foreign Affairs, the UN Global Compact and the Principles for Responsible Investment initiative.
Download the report
«The Responsible Investor's Guide to Commodities»
A group of institutional investors currently representing US$1.3 trillion in assets have launched the Principles for Responsible Investment in Farmland (the "Farmland Principles") with the goal of improving the sustainability, transparency and accountability of investments in farmland. onValues provided facilitation support to the working group that drafted the Principles.
The Farmland Principles offer institutional farmland investors best practice guidelines in the areas of environmental sustainability, labour and human rights, land and resource rights, business and ethical standards, and transparency. They were developed and endorsed by the following institutions: AP2 (Sweden), ABP (Netherlands), APG (Netherlands), ATP (Denmark), BT Pension Scheme (UK), Hermes EOS (UK), PGGM (Netherlands) and TIAA-CREF (USA), all of whom are signatories to the UN-backed Principles for Responsible Investment (PRI). These institutions will continue to work on implementing responsible investment in farmland via the PRI's newly formed Commodities Work Stream.
Download the Farmland Principles
«The Principles for Responsible Investment in Farmland»
Representatives from 20 European foundations met today in Brussels at the headquarters of the European Foundation Centre. The day's key question was: "How to mainstream mission-aligned investing at European foundations in 10 years?"
Mission-aligned investing enables a foundation to use its capital endowment for a social purpose while still safeguarding the financial health of the organization through a combination of responsible investments and impact investments. While some foundations and regions in Europe are advanced in this practice, in general European foundations lag other institutional asset owners in implementing investment policies that consider environmental, social and governance factors as part of standard investment analysis.
Participants in the workshop—entitled 360-degrees for Mission—discussed concrete steps to accelerate mission-aligned investing in Europe over the next decade. The workshop concluded that real opportunities for collaborative action among foundations exist and can resolve many of the remaining challenges facing foundation investors. A working group of the European Foundation Centre is currently being planned to continue making progress in this area.
360-degrees for Mission was co-hosted by the Mistra Foundation (Sweden), Fondazione Cariplo (Italy), and Fonds 1818 (Netherlands) and organized by onValues and the European Foundation Centre.
Download the meeting report
«360-degrees for Mission Meeting Report»
On June 17, 2011, onValues hosted an investor roundtable on the topic of: "Agri-investing for the long term: the investment case for responsible investments in agriculture". The meeting, which took place in Geneva, was co-hosted by the Swiss Federal Department of Foreign Affairs, the UN PRI and the UN Global Compact.
Over 60 experts from asset owners, asset managers, investment research and the public sector took part in what was likely the first event of this type dedicated to questions of responsible investment in agriculture and commodities. The discussion focused on issues related to farmland investments, commodity derivatives and listed equities in the agricultural value chain.
"Responsible investment in agriculture is a necessity, not an option" argued one investor. While a healthy diversity of views was expressed during the day, participants clearly articulated a strong economic rationale for considering environmental and social factors in agricultural investments. In this critical sector, participants agreed, investors can take steps to act as a positive and stabilizing force in agricultural markets in view of contributing to global food security.
Download the meeting report
«Agri-investing for the long term»