RI round-up Jan 19

The AustralianSuper Fund, which invests Aus$30bn for 1.24 million Australians has abandoned its former ethical exclusion policy in favour of a ‘best-in-class’ sustainability approach. The fund previously excluded investment in companies which derive more than five percent of their revenues from alcohol, tobacco, gambling or the manufacture of gambling, uranium extraction or weapons manufacture. On January 13, AustralianSuper’s domestic investment manager, Perpetual switched to the new strategy within its sustainable balanced and Australian sustainable shares options, mirroring the approach of Dexia, the fund’s international equities manager.
Wai-Shin Chan has left the post of executive director at ASrIA, the Asian socially responsible investment associations. Chan is joining Environmental Investment Services Asia Limited, which invests into environmental companies in Asia and seeks to integrate ESG into the investment process. Chan will continue to be an advisor to ASrIA on future projects. The new executive management team at ASrIA is David Sheil and Erik Floyd.
The Universities Superannuation Scheme has taken a 5% stake in a UK company that supplies components for solar energy applications. Manchester-based Nanoco Group said USS bought 9.4m shares at 10 pence each, giving it a 5.1% stake. Nanoco, which joined AIM in 2009, makes “quantum dots” – fluorescent nano-sized particles of semiconductor material – which can be used in the manufacture of, cheap and efficient solar cells, lighting, displays and biological applications.
The Swedish Ethical Council, the collaboration between four of the Swedish buffer funds (AP1, AP2, AP3 and AP4), has appointed UK-based Manifest to provide global voting services. The funds cited Manifest’s high quality, tailored voting recommendations, voting management and the fact that it was “the most economically beneficial system with the lowest total cost”. The funds, which jointly control around €70bn in assets, are expanding their direct involvement in votingactivities in global equity portfolios as a result of increased commitment to corporate governance. During 2009 the funds ran a pilot voting project and voted at the shareholder meetings of around 300 foreign companies – although each fund made its own decision in each individual company. Manifest has an alliance with US proxy advisory and voting service ProxyGovernance Inc.
Two of the Swedish buffer AP funds are backing a SEK235m (€30m) capital raising by agricultural land developer Alpcot Agro. The company said existing shareholders AP2 and AP3 – who have a combined 19% stake in the firm – have undertaken to subscribe for their respective pro-rata shares in the rights offering. Alpcot is a Swedish firm which buys and farms agricultural land in Russia and other CIS states.
Almost one hundred NGOs from more than 25 countries have written to all banks and financial institutions that have adopted the Equator Principles, calling on them to drastically reform the seven year old initiative. The letter was sent prior to a meeting which will take place next month between NGOs and banks that have adopted the Principles. The letter said: “We see a lack of spirit, of belief in the vast potential of the Principles amongst the very banks that have adopted them. We witness an inward looking initiative that continues to operate in secrecy, that has no internal strength to take on new challenges, or deal with issues which incorporation is already long overdue, and that continues to deny affected communities and other stakeholders their rightful place in the process”
Future Capital Partners, the £6bn alternative investment boutique, has launched a new UK-based private equity fund in the renewable transport fuels (RTFs) sector for the first time. It said it expected the production of European RTFs such as ethanol, to grow tenfold over the next decade. The fund is aiming to raise £40m equity, of which it has already secured over £5m, including £3m investment from Future Capital Partners itself.

The Co-operative Insurance Society, the insurance arm of the UK’s largest consumer co-operative, has taken a 12% stake in Ludgate Environmental, the green funds company launched in 2007 with money from pension fund investors. The move gives it exposure to sectors such as wind turbines, waste recycling and renewable energy. Ludgate, a Jersey-domiciled AIM-listed company, said in a filing before the Christmas break that Co-operative now holds 5.5m shares – 11.99% – of the company. Ludgate was recently part of an additional fund raising for Dutch wind turbine firm Emergya Wind Technologies alongside Emerald Technology Ventures, Rabo Ventures and Impax Asset Management. It led an €8.1m investment in electronic waste recycler Terra Nova along with France’s Aurinvest, BNP Private Equity and Finorpa. It also made a £5m investment in renewable energy company New Earth Solutions. Ludgate reported that its net asset value per share rose 5.9% in the six months to the end of September.
France’s Demeter Partners said it has closed its new cleantech Demeter 2 fund at €203m with sponsors including Caisse des Dépôts’ CDC Entreprises and IFP Investissements, part of the Institut Français du Pétrole. New investors included the European Investment Fund, Spanish fund of funds Neotec, Pictor, Total, Dalhia, GDF Suez, Actys 2, Crédit Coopératif and AXA. Investors from the original Demeter fund also signed on for Demeter 2. They are: Cardif, Robeco, CM-CIC, CNP Assurances and Predica. Demeter 2 will invest in French and European cleantech ventures. Demeter Partners has €308m in assets under management. Demeter 2, which follows the original €105m Demeter fund, was launched in November 2008.
The voting record of New York’s five pension funds on corporate governance and social and environmental responsibility during the 2009 proxy season has been hailed by William Thompson, the New York City Comptroller. He said the funds filed resolutions to 124companies. Corporate governance proposals were filed with 32 companies – with 14 firms adopting and majority votes won at eight. Proposals on corporate social and environmental responsibility issues were submitted to 92 companies.
CalPERS is seeking congressional support for efforts by shareholders to improve governance at firms bailed out under the government’s Troubled Assets Relief Program (TARP). The fund has $7bn (€4.9bn) invested in assets in TARP companies and has a strong financial interest in how they are governed, the scheme told a panel at the House Committee on Oversight and Government Reform.
The Securities and Exchange Commission has re-opened the consultation process on its plan to allow shareholders to nominate directors to corporate boards. The proposal – first tabled in June 2009 – would require companies to
include shareholders’ nominations for directors in their proxy statements. The SEC is seeking views on new data and analysis it has received since the original public comment period ended in August. Final recommendations are expected in early 2010.
Insight Investments says it devolving the responsibility for its analysis of environmental, social and governance (ESG) issues to its portfolio managers after disbanding its specialist responsible investment unit. The manager has reinstated its respected RI research to its website.
Link to site
Goldman Sachs is being sued by the Illinois Central Laborers’ Pension Fund, which is seeking to recover billions of dollars of bonuses and other compensation being awarded for 2009, saying the payouts harm shareholders. Goldman says the lawsuit is without merit.
SNS Asset Management has launched the third fund in its line of responsible index products: the SNS Responsible Index Fund – Equity Pacific, following its equivalent funds in Europe and the US.