ESG roundup: ESG demand, The 30% Club, UK Carbon Budget

first_imgHowever, when it came to the reasons for incorporating this into their investment strategy, the majority, 58%, of respondents did so due to a sense of personal responsibility.In addition, just over half (52%) stated that it was the companies’ procedure to apply such criteria to investments.In terms of the most proactive practitioners of these principles, developed economies were perceived to be the most keen, with Western Europe cited by 86% of respondents, followed by North America with 36% and Australasia with 24%.With regard to asset owners, pension funds were viewed as the most willing group to incorporate ESG factors within their portfolios – cited by 73% of respondents – ahead of charities with 62%.The research was conducted among 85 pension fund managers and advisers in September.In other news, an interim report by The 30% Club’s ‘Balancing the Pyramid’ Group, business psychology consultancy YSC and professional services firm KPMG revealed that a man starting his career with a large FTSE 100 UK company is 4.5 times more likely to make it to the executive committee than his female counterpart, despite a now average 21% female representation at the surveyed organisations’ executive committee level and 25% of organisations achieving 30% female representation.The study – undertaken across a section of FTSE 100 and FTSE 250 companies, totalling more than 450,000 employees, both male and female – has debunked some of the myths about how women progress to the very top and aims to give practical and constructive advice to companies on how to update their gender intelligence.It found that, overall, men and women are equally ambitious. However, because women tend not to show the same level of ambition early, this exponentially lifts by the time they reach executive levels, according to the study, and companies need to consistently reassess career options for women, particularly when male peers are more overt about aspiring over a longer range.Helena Morrissey, chief executive at Newton Investment Management and founder of The 30% Club, said: “Men and women are different – equally intelligent, but we behave differently and are motivated by different things.”This new research gives more depth to the intuitive argument that balanced teams perform better and gives companies specific actionable ideas to improve their management of all talent – regardless of gender.”The study found that quality of line-management proved a bigger boost to women’s commitment than formal development programmes, sponsoring, mentoring or executive coaching.The full analysis and report will finish early next year.Meanwhile, European investors have responded to the publication of the Committee on Climate Change’s updated recommendations on the UK’s Fourth Carbon Budget by urging the government to stick to its current emissions reduction objectives to deliver the billions in energy investment the country needs.Stephanie Pfeifer, chief executive of the Institutional Investors Group on Climate Change (IIGCC) – which represents more than 85 of Europe’s largest investors, worth a combined €7.5trn – said: “The UK desperately needs investment in its energy infrastructure to secure its future power supply. Independent estimates have put this investment need at £330bn (€392bn) by 2030.”This investment will only happen if investors are confident in the UK government’s commitment to a low-carbon energy future. Changing course on emissions reduction objectives now would undermine this confidence and damage investment prospects.“By putting in place ambitious policies, the UK can be a leader in the development of a low-carbon economy that creates jobs and boosts growth. The government can reassure investors and signal its commitment to a low-carbon future by sticking to the emissions-reduction objectives outlined in the fourth carbon budget.” Nearly half of institutional investors, 48%, say their appetite for environmental, social and governance (ESG) or socially responsible investment (SRI) strategies has increased over the past six months, according to research by ING Investment Management International (ING IM).Three-quarters of surveyed investors believe being environmentally and socially responsible – as well as encouraging good global governance  – is important to the future of investment.The findings also show that two-thirds of investment professionals responsible for pension funds already integrate ESG or SRI into their investment processes.Of those surveyed, a greater reliance on responsible investment criteria was expected to bear fruit in terms of investment return over the next five years.last_img read more

Alcatel-Lucent UK scheme completes £300m buy-in

first_imgMartin Couzens, chairman at Alcatel-Lucent Pension Trustees, said he was very satisfied by the security offered by the deal.“We have obtained full insurance backing for most of our pensioners and even made a saving against our funding reserve,” he added.“Overall, this takes us substantially closer towards our goal of full buyout.”Dominic Grimley, principal consultant and risk settlement specialist at Aon Hewitt, said the deal was agreed after a “strongly contested” auction.“Aviva has shown great flexibility to accommodate the scheme’s needs, and the trustees have acted extremely efficiently throughout to secure an ideal result for all parties in a short space of time,” he said. The transaction came amid a flurry of activity in the UK de-risking market, which exceeded £10bn in transactions last year, with a predicted boost of £5bn on the back of the introduction of Solvency II expected this year. The UK pension fund for Alcatel-Lucent has completed a £300m (€408.6m) buy-in, de-risking approximately one-third of its liabilities.The French telecommunications giant’s scheme chose to de-risk its pensioner liabilities as part of a longer de-risking objective, according to a statement by Aon, which advised the scheme trustee.Insured with Aviva, the transaction completed during the summer of 2015, accounting for the majority of the company’s business written over the first two quarters of last year.By the second quarter of 2015, Aviva had completed 13 deals worth £407m, according to figures compiled by Aon Hewitt, with £405m across 10 deals written during the second quarter.last_img read more

Number of Dutch schemes set to drop to 200 next year, regulator says

first_imgThe Dutch regulator (DNB) has predicted that the number of pension funds in the country will drop from 300 to about 200 by the end of next year, as consolidation continues apace.Speaking at the Euroforum congress on Thursday, Bert Boertje, director of pension fund supervision at DNB, said he based his estimate on talks with a number of pension funds already expressing a desire to be wound up.Boertje told IPE he also expected the consolidation trend to continue after 2017.“If the new pensions system leads to more uniform pension arrangements,” he said, “it will become easier for pension funds to merge.” Boertje said rising costs would increase the pressure to consolidate, as he expected pension-fund participants with more freedom of choice to be generally more demanding of Dutch schemes.The DNB director said that, in recent years, 40-50 pension funds had been wound up annually.In 2010, Joanne Kellermann, supervisory director at DNB at the time, said 100 pension funds would be sufficient in the Netherlands.In 1997, the country still counted 1,060 schemes in total.last_img read more

Denmark roundup: ATP cancels major benefits admin contract

first_imgFrank Jensen, the mayor of Copenhagen and chairman of Udbetaling Danmark, said: “We are now initiating arbitration and our demand will be for an amount in the high three-digit millions, which is the loss that local authorities and thus taxpayers ultimately may have to pay.” KMD’s legal director and lawyer Mark Skriver Nielsen said the firm was surprised by ATP’s action, but now expected to have the matter settled in court, which he said was sad for all parties including the municipalities.“We had hoped to find a common solution, but we are ready to accept arbitration,” he said.He defended KMD against some of ATP’s claims.Meanwhile, Danish labour market fund Industriens Pension reported a rise in investment returns last year, producing 8.2% overall after a 6.7% gain in 2015.High-yield bonds and infrastructure were the strongest-yielding asset classes during the year, Industriens said.High-yield corporate bonds generated a 14.8% return, outperforming the benchmark by 1.8 percentage points, while infrastructure made an 11.4% return, according the pension fund’s annual report.Foreign equities underperformed the benchmark by 1.5 percentage points, giving a 7.7% return. Danish equities generated 3.2%, which was in line with the comparison index.Solvency levels fell to 342% at the end of 2016 from after the transition last year to new Solvency II-based rules, from 479% for 2015 when calculated according to the new rules.The pension fund put the solvency fall down to an increase in capital demands and the fact that less of its so-called tax assets could now be included in the recognised capital base.Industriens Pension’s total assets grew to DKK157m at the end of December, from DKK149bn the year before. Denmark’s ATP has cancelled a huge IT contract between the public payments operation it runs and software supplier KMD, and is seeking more than DKK500m (€67.2m) in compensation.The pension fund said the board of Udbetaling Denmark (Payments Denmark) had decided to halt the deal for a new system to pay pensions and early retirement benefits to 1.3m people, because delivery was already at least 15 months late and KMD could not guarantee there would be no more delays.Udbetaling Danmark is a public authority responsible for collecting, paying, and controlling a number of public benefits, and is administered by the ATP Group.ATP also said KMD was not suppling Udbetaling Danmark with the standard pension system agreed in the contract.last_img read more

Netherlands roundup: Pension funds returned 38.6% since 2013

first_imgPensioen Pro also found that fiduciary management now covers 95% of Dutch combined assets of €1.28trn.Pro, which has surveyed fiduciary management in the Netherlands for the tenth consecutive year, said that it had increased sevenfold in this period.Interest hedging up in third quarterDutch pension funds slightly increased their hedging of interest rate risk on liabilities in the third quarter of 2017.DNB statistics revealed that schemes raised the interest cover by 0.9% on average, to 51.3%. The regulator said that 62% of schemes increased their interest hedge, while 31% reduced the cover.However, the DNB figures showed significant differences between pension funds. For example, the €5.3bn sector scheme for care insurers (SBZ) reduced its hedge by 8.4% to 52.9%, while the €3bn pension fund for the furnishing industry (Meubel) raised the cover by 8.7% to 52.4%.The €403bn civil service scheme ABP reduced its interest hedge from 27.7% to 27.2%.Bigger pensions say for small companies’ staff The Dutch cabinet wants staff of small companies to have a greater say about their pension arrangements.In a letter to parliament, social affairs minister Wouter Koolmees announced legal proposals to strenghten the position of staff associations or representatives through an improved right to information as well as raising issues.These bodies play a role at small companies of up to 50 employees, which are exempt from having an official works council (OR).Koolmees suggested that small firms hold a staff meeting twice a year or that staff voluntarily set up representation.Either would entitle them to the right to advice about pension adjustments affecting more than one-quarter of staff.To increase the heft of this right, the cabinet wants to force companies to give the staff bodies sufficient notice, in writing, of the pending charges, the minister said.He added that he would also allow staff representations to put pension topics on the agenda.However, Koolmees made clear that introducing a right of approval, as the OR has, would be a step too far, as the administrative burden might deter small employers from offering a pension scheme. Dutch pension funds’ investments gained 38.6% in total between the start of 2013 and the middle of this year, their quarterly reports have revealed.The schemes achieved the best results in 2014 and 2016, with net profits of 19% and 10.4%, respectively, according to IPE’s Dutch sister publication Pensioen Pro, which looked at the figures submitted to supervisor De Nederlandsche Bank (DNB).It found that alternatives – predominantly private equity – returned 78.6% in total during the 4.5-year period, with liquid equity (66.9%) and real estate (45.2%) also performing very well.Hedge funds generated 19.8%, while commodities almost halved in value, decreasing 47.6%.last_img read more

ICGN ‘adds voice calling for change’ in racial discrimination statement

first_imgCredit: Paul Becker/Becker1999Issued yesterday, the organisation’s racial discrimination statement continued: “In the wake of these events, ICGN believes that is our duty to listen; and to continue to educate ourselves and our organisations about racial discrimination and other forms of inequality.“It is our obligation to take concrete actions to dismantle the culture and structures that advance racial and other forms of discrimination. It is our duty to accept these responsibilities as core to our mission and purpose.“It is our duty, as investors and companies, to embrace this shared responsibility and to find opportunities to collaborate and cooperate to end systemic racial discrimination and build fairer and more sustainable economies.”“We will continue to listen. We will continue to learn. And we will take our actions forward”Robert Walker, chair of the ICGNRobert Walker, former head of ESG services at Canada’s NEI Investments and chair of the ICGN, added: “A new generation of African-American voices has emerged to take their place alongside leaders from historical struggles. This statement takes its inspiration from those voices.“We have done our best to listen and learn and, with this statement, add our voice to the millions of people calling for lasting change. But this is only one step. We will continue to listen. We will continue to learn. And we will take our actions forward. Our efforts will be directed into the world of stewardship and corporate governance.“We invite others to join us in this endeavour.”Calvert CEO: ‘We have not done enough’ICGN’s statement comes after the president and CEO of Washington D.C.-based Calvert Research and Management, said ending racism in America was a responsibility of corporations, and that investors needed to push hard for positive change.“Although Calvert has been a leader in dealing with inequality and pushing corporate boards to establish greater diversity, we have not done enough,” he said.“As CEO of Calvert and a part of the system, I recognise that much more needs to be done. More open and forceful action is required by investors and by corporate leaders and boards.”The ICGN and Calvert CEO’s statements can be found here and here, respectively.Looking for IPE’s latest magazine? Read the digital edition here. The International Corporate Governance Network (ICGN) has issued a statement on racial discrimination in the wake of the death of George Floyd while being restrained by police in the US state of Minnesota, saying that by doing so “we add our voice to the millions of people calling for lasting change”.Floyd, a black man, died on 25 May while being restrained by police in the US city of Minneapolis, with video footage showing a white police officer continuing to kneel on his neck even after Floyd was pleading he could not breath. The circumstances of his death have triggered protests across the US and in other countries.According to the BBC, his death has been declared a homicide in an official post-mortem examination and the charge against the police officer kneeling on Floyd’s neck has been elevated to second-degree murder. Three other officers face counts of aiding and abetting murder.In its statement, the ICGN said Floyd’s death and the protests it had sparked “provide a stark demonstration of what it means to ignore inequality, human rights and the fundamental lack of justice and fairness in society”. “Investment institutions and companies cannot divorce themselves from this social and historical context,” it said.The ICGN is an investor-led coalition of governance professionals that counts many major asset owners among its members in addition to asset managers, non-financial corporates, and other organisations. #*#*Show Fullscreen*#*#last_img read more

​Norway’s SWF recoups investment losses after summer rally

first_imgIn results for January to June, the fund reported a 6.8% loss on its equity investments – which made up 69.6% of the fund at the end of June – but a 5.1% gain on fixed income investments, whose allocation stood at 27.6%.NBIM said in the report that its bond portfolio has been boosted by lower interest rates.“The coronavirus pandemic led to global monetary easing, with rate cuts and active use of central bank balance sheets,” it said.Investments in unlisted real estate lost 1.6% in the six-month period, with that asset class making up 2.8% of the fund’s portfolio at the end of June.NBIM underperformed its benchmark in the period, with the fund’s overall return 11 basis points lower than the return on the benchmark index, according to the report.In 2020, the Norwegian government began withdrawing money from the fund for the first time since 2017, taking out NOK167bn in the period – more than it has yet withdrawn in any single year, as the country’s state finances came under pressure as a result of the coronavirus pandemic as well as falling oil prices.However, the weakening of the Norwegian krone on foreign exchanges resulted in a NOK672bn gain for the fund between January and June.Mainly because of this, the fund’s value grew to NOK10.4bn at the end of June from NOK10.1bn at the end of last year, in spite of the 3.4% loss as measured in the basket of currencies NBIM uses for reporting.Looking ahead, Grande said that even though markets had recovered well in the second quarter, there was still considerable uncertainty for investors, with the pandemic being the main factor behind this.“It is still a global pandemic and it doesn’t seem to be under control in any shape or form – the development of a vaccine has not yet come to fruition,” he said at the news conference.Looking for IPE’s latest magazine? Read the digital edition here. Norway’s sovereign wealth fund has now recouped all of the huge investment losses suffered earlier this year, with its portfolio having returned to end-2019 levels – as measured in the basket of international currencies it uses for formal reporting.Performance of the fund’s assets in the last six weeks has closed the 3.4% investment loss stated in the Government Pension Fund Global’s (GPFG) interim report for the first half of this year, which was released today, journalists at this morning’s news conference in Oslo heard.Trond Grande, deputy chief executive officer of Norges Bank Investment Management (NBIM), the central bank operation running the oil fund, said: “The markets performed well during the summer, particularly the equity markets, and we’ve seen falling interest rates so there’s some uplift on the bonds as well.“So the fund is now basically zero, maybe a little bit plus for the year as a whole,” he said.last_img read more

Developer predicts ‘game changer’ for suburb

first_img… and spacious interiorsThe complex will be made up of two buildings, Banksia, to be seven levels, and Poinciana will be eight levels, and while the finishes will be the same, the two buildings offer a selection of different floorplans. Prentice Park Residences will be built at Lutwyche“Relating it to Fortitude Valley, maybe 10 or 15 years ago, it was a very downtrodden area, it was a bit dodgy,” he said. “Then the Emporium launched and a few other high-end projects launched and the dynamic of Fortitude Valley and that area has changed and that’s really what this project is all about. “We’ve got a unique, unrepeatable location and once we build this high-quality product, it’s really going to change the dynamic of the whole suburb.“It’s right next to Grange and Gordon Park, which are high-end suburbs in Brisbane and the shopping centre is undergoing a $60 million expansion and upgrade.”Mr Merchant said building would start in September or October 2018 and would offer “affordable luxury” with large interiors.More from newsParks and wildlife the new lust-haves post coronavirus17 hours agoNoosa’s best beachfront penthouse is about to hit the market17 hours agoThe developer is promising “affordable luxury” …“Normally in inner Brisbane, like Teneriffe or New Farm, you would get these kinds of finishes and luxury, but you would pay $2 million for it, or something at that price point,” he said. “But here we are able to give you the same kind of luxury, with two-pak kitchen, Miele appliances standard, 40mm stone benchtops, high ceilings and so on.“But our three-bedrooms don’t go over $785,000, they’re from $695,000 to $785,000, and penthouses are under a million – $869,000 to $999,000. “You’re getting an alternative to that, with a high quality, luxury finish, but you’re not paying double price and you’re in front of never-to-be-built-out parkland with views across Kedron Brook and up to Mt Coot-tha as well.” Renders of the entertainment deck and pool Mr Merchant said they had designed the spaces to ensure they were very efficient.“People downsizing or coming from a larger space really won’t feel that sacrifice in apartment living,” he said.Prentice Park Residences is about 9km from the Brisbane CBD and within the Wooloowin State School and Kedron State High School catchments. Prentice Park Residences, a new development in Lutwyche, is expected to start construction within weeks.A new development is expected to boost market appeal in Lutwyche, according to developer Merchant Estates CEO Arshan Merchant.Mr Merchant said Prentice Park Residences would be a “game changer” for the northern suburb market and predicted the end result would be akin to how the Emporium development improved the Fortitude Valley market.last_img read more

Strong demand for new house and land near North Lakes

first_img“We are incredibly proud of our new Refined Living concept and designs,” Mr Bell said.“They have been 12 months in the making and showcase the latest on-trend designs that harness the way Queenslanders love to live.” Ausbuild has launched new home designs to coincide with the announcement of their new Element community at Griffen.Demand for new house and land near North Lakes has seen 11 lots already sell in an estate that was launched to the market just two weeks ago.Ausbuild’s latest offering Element at Griffen will bring 56 lots in the first stage, with civil construction starting earlier this week.Ausbuild joint managing director Matthew Bell said the company knew there was pent up demand for this style of development on Brisbane’s northside but, even so, had been surprised by the flurry of sales. >>FOLLOW EMILY BLACK ON FACEBOOK<<center_img More from newsParks and wildlife the new lust-haves post coronavirus16 hours agoNoosa’s best beachfront penthouse is about to hit the market16 hours agoOne of Ausbuildls new home designs.“Element is perfectly positioned to take in all that the North Lakes region has to offer,” Mr Bell said.“It is located next door to Griffin State School and is within easy reach of the North Lakes shopping and entertainment precinct.“We believe Element will follow a similar pattern of sales to the estates we have created in Bridgeman Downs and Albany Creek which have been very successful.“To me this shows if you build the right estate, in the right environment, it creates an appreciation of quality and a desire for people to want to be part of that community.”Along with the launch of the new community, Ausbuild has also announced their new Refined Living house range.last_img read more

Agent predicts another big year for the Brisbane property market

first_imgRay White New Farm auctioneer Haesley Cush in action. (AAP image, John Gass)You can normally count the number of inquiries, open house attendees and offers before Australia Day on your hands with enough space to still hold the tongs and work a BBQ. It’s normally pretty quiet, but not this year!As 2019 wakes up, the news from the frontline is that open houses are decorated with dozens of shoes scattered across the front entry, email inquiries are filling up agents inboxes and offers are in and leading to contracts.The last time I remember coming back from Straddie, our annual pilgrimage, to strong early inquiry was back in 2007. Aerial image of Point Lookout at North Stradbroke Island. SuppliedJanuary jumped out of bed that year and we experienced a huge surge in open house numbers, an increase in general inquiry and a spike in January contracts. It was the start of a two year mini-boom for inner city Brisbane.It’s usually the holiday conversations that fuel this push. Did people discuss whether it was time to buy, or playing the waiting game. More from newsParks and wildlife the new lust-haves post coronavirus14 hours agoNoosa’s best beachfront penthouse is about to hit the market14 hours agoWell, the chat around our camp fire was one of steady confidence. The Cush family at Straddie No one was bullishly running out to buy, but similarly no one was rushing out to sell their investment properties.With Australia Day just around the corner that means the coastal auctions will be taking place, and our first read on holiday house sales will be revealed. This is always a good gauge of consumer confidence and a market to watch for those trying to get a read on the year ahead.So from the early mail, I’m tipping 2019 will likely build on top of a pretty solid 2018. center_img Brisbane CBD skyline (AAP Image/Darren England) Which means we should see an increase in unit sales and there will be more prestige properties up for sale which will see mega sales in the Brisbane market this year.But it is the middle section of most suburbs that I will be watching with the most interest. This part of the market was hot in 2018 and if we see an increase at this median price level then it could be a very hot year. Haesley Cush is licensed real estate agent and auctioneer.last_img read more