The €1.4trn European asset manager Amundi has adopted a three-year action plan to increase its commitment to responsible investment, it announced yesterday.
By the end of 2021, environmental, social and corporate governance (ESG) analysis would be integrated across all Amundi funds, both active and passive, “wherever technically possible”, the manager said in a statement.
As part of this, all actively managed funds would be required to offer “ESG performance” above the ESG rating of their benchmark indices or universes, and “ESG assets” under passive management would double to at least €70bn, it said.
Shareholder engagement and voting at company shareholder meetings would “systematically” include ESG analysis, it added.
Currently, Amundi applies ESG criteria in addition to traditional financial analysis to €270bn of assets under management, less than one-fifth of its total assets. This involves a dedicated team assigning ESG ratings to companies, which can lead to certain stocks being overweighted or underweighted in portfolios, or completely excluded.
“It gives company management the incentive to improve their environmental and social impact,” added Amundi.
Its three-year plan would also see the manager developing ESG advisory services for institutional clients.
Amundi said it aimed to double the amount invested in “initiatives related to the environment and with a strong social impact”, it said, by increasing thematic funds to €20bn.
The manager currently has €10bn of dedicated funds with targeted investments, particularly aimed at tackling climate change. Last year Amundi launched a $2bn (€1.7bn) emerging market green bond fund.
Amundi said it would also increase its investments in the “social and solidarity economy” – a concept borrowed from the French “économie sociale et solidaire” (ESS). It has so far invested €200m in qualifying companies via a dedicated ESS fund, and planned to increase this to €500m.
Yves Perrier, chief executive officer at Amundi, said the three-year plan extended the manager’s commitment to responsible investment and “anticipates the expectations of our clients”.
CDPQ and Generation IM agree ‘long-term sustainable equity partnership’
Canada’s Caisse de dépôt et placement du Québec (CDPQ) and Generation Investment Management have teamed up with the aim of making $3bn of longer-term investments in private businesses.
The pair said they would be seeking to make investments with an 8-15 year duration, which the investors noted was much longer than was typical for private equity investments “and better suits the objectives of sustainable value creation to build successful long-term businesses”.
The firms’ first acquisition was announced today as FNZ, an Edinburgh-based technology company that powers a number of leading wealth management platforms in the UK.
Investments made by the partnership would target businesses with “outstanding” management teams and solid long-term growth prospects, according to a statement.
The investors said their investments would be “net positive” for the environment, benefit society, and in many cases would use technology as a key factor for driving change.
Michael Sabia, CEO of CDPQ, which has CAD308bn (€200bn) of assets, said: “This partnership is a natural match between two likeminded organisations.
“Sustainability begins with long-term involvement, which is why we made long-term investment the cornerstone of CDPQ-Generation.”
Impact reporting ‘coalescence’
There is growing appetite for “coalescence” in social and environmental impact reporting, according to a report from a UK government-commissioned social impact investing taskforce.
The report is the product of a working group set up to help develop better reporting of companies’ social and environmental impact, which was one of the recommendations of the advisory group that preceded the formation of the taskforce.
The report captured the fragmented impact reporting landscape, which it said reflected rapid growth in society’s expectations of business and the associated proliferation of reporting requirements, as well as “the absence of a common currency for impact”.
According to the report, there were at least 16 different reporting approaches related to impact investing.
However, the report struck an optimistic tone, noting that a number of efforts to unify approaches were underway, such as The Impact Management Project and Corporate Reporting Dialogue.
“These efforts confirm the growing appetite for coalescence, and are early useful steps on the journey,” said the report.
The majority of respondents to the working group’s call for evidence indicated they believed that coalescence could be achieved within the next five years, but that significant progress could already be made in the next six to 12 months.
The report can be found here.