Responsible Investor

RI round-up July 11

RI’s bite-sized round-up of the week’s most important responsible investment news.

Workers at Liverpool City Council have voted unanimously to pressure the £4.2bn (€5.8bn) Merseyside Pension Fund to which they belong to ballot participants on introducing an ethical investment policy. The proposal, tabled by Liberal Democrat councillor Richard Oglethorpe, says the fund should ask members whether to including an “ethical dimension” to its Statement of Investment Principles (SIP). Owen Thorne, investment officer at Merseyside Pension Fund said the fund took the vote seriously, but added that Liverpool City Council had no power to force the fund to review its SIP. He said that as a signatory to the United Nations Principles for Responsible Investment (UNPRI), the fund already considered ethical questions as part of investment process. Liverpool City Council workers make up about one third of the Merseyside fund’s members.
RImetrics, the UK-based research company, has launched the first Responsible Investment benchmark where asset owners and investment consultants can compare peer fund managers on their implementation of environmental, social and governance (ESG) issues. The Responsible Investment Benchmark (RIB) measures average industry performance across five key themes: strategy, engagement, integration, voting, and transparency & accountability. The data is compiled from global asset managers representing assets of over $12 trillion, including over half of the world’s leading 20 managers. Aled Jones, responsible investment manager at the UK Pension Protection Fund, said, “The ability to compare and contrast managers, on a range of factors regarding their responsible investment capabilities, is a welcome addition to the manager research market.”

The Carbon Trust, the UK government funded body for transitioning to a low-carbon economy, is understood to be working with McKinsey, the management consultancy, on a report into the materiality of climate change issues for investors. The report is expected to be published later this year.
Richard Burrett, managing director for sustainable development at ABN Amro, the Dutch bank, is understood to have left the bank. ABN was bought out at the end of 2007 by a consortium of Royal Bank of Scotland, Belgo-Dutch Fortis and Santander of Spain. Burrett launched ABN’s sustainable development initiative 2004, prior to which he was the bank’s global head of project finance.
Hermes, the fund manager owned by the BT Pension Scheme, the UK’s largest, is to merge its two main activist funds into a single partnership structure with more than ten Hermes executives expected to receive equity stakes as a result. Hermes will merge Focus Asset Management and Focus Asset Management Europe into a combined £2.3bn manager called Hermes Focus Asset Management LLP, comprising one pan-European Focus Fund covering the UK and Continental Europe and one single fund dedicated to the UK. The new structure will be jointly owned by Hermes and its executives and be led by Stephan Howaldt, Wouter Rosingh and Paul Harrison. Hermes chief executive, Rupert Clarke, said the partnership would ensure that executives are well incentivised to deliver strong performance: “The new LLP is consistent with our overall strategy to have a multi-boutique structure working alongside specialist investment management teams.”

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