Responsible investment “continues to gather momentum globally”, driven by investor values, risk management and the introduction of stronger codes and standards, according to asset management business F&C.
The firm – which controls £83.4 billion in assets – said environmental, social and governance (ESG) issues were now “material to long-term company performance”.
Its 2013 Responsible Investment Report, released on Tuesday, says ESG integration has “relevance across asset classes and investment styles”. It also gives details on F&C’s engagements with 716 companies and its voting habits in more than 59,000 resolutions in 2013.
Vicki Bakhshi, the firm’s head of governance and sustainable investment, said there had been a “marked increase” in the number of in-depth questions F&C was receiving on responsible investment.
“We used to get a lot of questions asking if we were a [Principles for Responsible Investment (PRI)] signatory; we now get much more searching questions about exactly how ESG issues fit within the investment process and asking us for evidence that that’s happening”, she said.
The report says that F&C achieved almost 300 “instances of change” as a result of its engagement with companies in 2013. This, the firm said, was crucial in delivering strong long-term performance.
At a press briefing on Monday, Bakhshi said one area F&C was focusing its engagement efforts on in 2014 was stranded assets – specifically the financial risks associated with fossil fuel investments.
Research by the UK-based thinktank the Carbon Tracker Initiative suggests that as much as 80% of current known reserves are “unburnable” when the need to keep global warming below 2C is factored in. Bakhshi said such analysis had driven increased engagement on the issue.
However, while Carbon Tracker’s work may have prompted other investors to divest their coal, oil and gas holdings, she added that F&C wasn’t looking to make such a decision.
“The aim of our engagement is to encourage companies to have better ESG risk management. [But] sometimes some of the findings that we have when we engage with companies might change the way [fund managers] think about investing in a company”, she said.
Company boards, human capital and executive remuneration were also highlighted as key areas for the coming 12 months – during which time F&C said responsible investment would “continue to gather momentum globally“.
It attributed this increased interest to the investor values, ESG risk management and the codes or standards like the Stewardship Code and the PRI that had become more prominent.
F&C is celebrating 30 years in ethical and sustainable investment in 2014, having launched Europe’s first ethical fund, the Stewardship Growth fund, in 1984. The firm agreed to an all-cash £708m takeover by Canadian Bank BMO Global Asset Management in January.
F&C’s range of ethical and sustainable funds had £3.42 billion invested in them at the end of 2013.
A Good Look At How Homes Will Become More Energy Efficient Soon
Everyone always talks about ways they can save energy at home, but the tactics are old school. They’re only tweaking the way they do things at the moment. Sealing holes in your home isn’t exactly the next scientific breakthrough we’ve been waiting for.
There is some good news because technology is progressing quickly. Some tactics might not be brand new, but they’re becoming more popular. Here are a few things you should expect to see in homes all around the country within a few years.
1. The Rise Of Smart Windows
When you look at a window right now it’s just a pane of glass. In the future they’ll be controlled by microprocessors and sensors. They’ll change depending on the specific weather conditions directly outside.
If the sun disappears the shade will automatically adjust to let in more light. The exact opposite will happen when it’s sunny. These energy efficient windows will save everyone a huge amount of money.
2. A Better Way To Cool Roofs
If you wanted to cool a roof down today you would coat it with a material full of specialized pigments. This would allow roofs to deflect the sun and they’d absorb less heat in the process too.
Soon we’ll see the same thing being done, but it will be four times more effective. Roofs will never get too hot again. Anyone with a large roof is going to see a sharp decrease in their energy bills.
3. Low-E Windows Taking Over
It’s a mystery why these aren’t already extremely popular, but things are starting to change. Read low-E window replacement reviews and you’ll see everyone loves them because they’re extremely effective.
They’ll keep heat outside in summer or inside in winter. People don’t even have to buy new windows to enjoy the technology. All they’ll need is a low-E film to place over their current ones.
4. Magnets Will Cool Fridges
Refrigerators haven’t changed much in a very long time. They’re still using a vapor compression process that wastes energy while harming the environment. It won’t be long until they’ll be cooled using magnets instead.
The magnetocaloric effect is going to revolutionize cold food storage. The fluid these fridges are going to use will be water-based, which means the environment can rest easy and energy bills will drop.
5. Improving Our Current LEDs
Everyone who spent a lot of money on energy must have been very happy when LEDs became mainstream. Incandescent light bulbs belong in museums today because the new tech cut costs by up to 85 percent.
That doesn’t mean someone isn’t always trying to improve on an already great invention. The amount of lumens LEDs produce per watt isn’t great, but we’ve already found a way to increase it by 25 percent.
Maybe Homes Will Look Different Too
Do you think we’ll come up with new styles of homes that will take off? Surely it’s not out of the question. Everything inside homes seems to be changing for the better with each passing year. It’s going to continue doing so thanks to amazing inventors.
ShutterStock – Stock photo ID: 613912244
IEMA Urge Government’s Industrial Strategy Skills Overhaul To Adopt A “Long View Approach”
IEMA, in response to the launch of the Government’s Industrial Strategy Green Paper, have welcomed the focus on technical skills and education to boost “competence and capability” of tomorrow’s workforce.
Policy experts at the world’s leading professional association of Environment and Sustainability professionals has today welcomed Prime Minister Teresa May’s confirmation that an overhaul of technical education and skills will form a central part of the Plan for Britain – but warns the strategy must be one for the long term.
Martin Baxter, Chief Policy Advisor at IEMA said this morning that the approach and predicted investment in building a stronger technical skills portfolio to boost the UK’s productivity and economic resilience is positive, and presents an opportunity to drive the UK’s skills profile and commitment to sustainability outside of the EU.
Commenting on the launch of the Government’s Industrial Strategy Green Paper, Baxter said today:
“Government must use the Industrial Strategy as an opportunity to accelerate the UK’s transition to a low-carbon, resource efficient economy – one that is flexible and agile and which gives a progressive outlook for the UK’s future outside the EU.
We welcome the focus on skills and education, as it is vital that tomorrow’s workforce has the competence and capability to innovate and compete globally in high-value manufacturing and leading technology.
There is a real opportunity with the Industrial Strategy, and forthcoming 25 year Environment Plan and Carbon Emissions Reduction Plan, to set long-term economic and environmental outcomes which set the conditions to unlock investment, enhance natural capital and provide employment and export opportunities for UK business.
We will ensure that the Environment and Sustainability profession makes a positive contribution in responding to the Green Paper.”