Annual Event 2017
The day after the One Planet Summit, Novethic’s annual ESG Strategies for Responsible Investors Conference took place to gather major asset owners from across Europe.
This 10th edition was marked by the strengthened commitment of 300 investors, reuniting on this occasion in order to anchor climate and environmental, social and governance (ESG) issues into the core of their investment and management strategies.
HIGHLIGHTS
EUROPE LEADS THE WAY IN SUSTAINABLE FINANCE
During the opening session, Olivier Guersent, Director-General for Financial Stability, Financial Services and Capital Markets (DG FISMA) for the European Commission, recalled that while the European Union can boast on having implemented the most advanced ESG standards to date, there is still work to be done. The origin of the European High-Level Expert Group (HLEG) on sustainable finance is meant to be moving in this direction. “A unique working group for its kind”, was pleased to say its chairman, Christian Thimann, as it is rare to be able to work with a legislator and nurture dialogue with institutional investors.
AN IMPACTFUL INVESTORS LUNCHEON
During the investors’ luncheon, Virginie Chapron du Jeu, Chief Financial Officer of the Caisse des Dépôts Group, noted that the deployment of climate policies, the diffusion of ESG culture and the reinforcement of sustainability standards remain decisive factors for the future of corporations and financial institutions.
CLIMACTS! MAJOR EUROPEAN INVESTORS SPRING INTO ACTION
In the Netherlands, the United Nations Sustainable Development Goals (SDGs) will be the reference framework for the €58 billion Dutch civil service pension fund, ABP. In France, the SDGs are not widely engaged, but the reporting requirements of article 173 have initiated a movement that will benefit the entire chain of actors engaged in ESG. Further north, the Norwegian Oil Fund's Ethics Board continues to define its exclusion rules while expanding its effort in shareholder dialogue, particularly through field surveys. As its engagement policy becomes more widespread, the fund has found that some companies, with whom a dialogue has already been established, are ready for real change. In the United Kingdom, various legislative advances have succeeded in pushing asset owners towards responsible long-term management. 15% of the UK Environment Agency's pension fund portfolio is already invested in climate solutions, and their separate “Targeted Opportunities Portfolio” (TOP) must comprise 5% of the total. In Germany, the responsible investment market finally seems established, according to Robert Hassler, CEO at oekom research AG, although some market players still tend to question the process rather than take action. In the end, it may be the scandals, and the fines that go with it, that will make ESG criteria fully accepted.
WAKE-UP CALL!
The day continued with a “wake-up call” exercise. Four asset managers presented their arguments, from an investor’s perspective, surrounding the digitization of the building sector, renewable energy storage, environmental externalities and ecosystem services, as well as ESG materiality analysis. Enthusiasts will surely note that, according to Hamish Chamberlayne, Head of SRI at Janus Henderson Investors, some investment opportunities in energy transition could be considered the heist of the century!
INSURING THE FUTURE
At the end of the conference, Nick Robins, Co-Director of the platform UNEP Inquiry, and François Garreau, Chairman of the Sustainable Development Commission of the French Insurance Federation (FFA ), evoked that in the face of climate change, insurers are mobilizing on a large scale. This mobilization is seen through the Sustainable Insurance Forum initiative at the regulator level, or with the new “Appeal on Climate Change” signed by 35 European and international insurer federations during the One Planet Summit.