Diary of an Investor: Greenstreaming, anyone?
Everyone seems to have an opinion about carbon these days, which probably has something to do with the COP21 climate change talks in Paris at the end of last year, plus all the action on green energy investment and fossil fuel divestment.
It makes a break from our corporate sponsor’s plan to centralise the investment function of the pension funds here in Utrecht while moving our European domicile to Belgium. Put it this way: the proposal is an unpopular one and is currently mired in stakeholder meetings because the unions have a huge set of objections. But Lars and Paul, the management consultants, have been busy in meetings with everybody in the pensions department as they research how to create “optimum synergies” in the way the teams operate across the world.
All this talk of carbon is a welcome distraction. So far at Wasserdicht Pension Funds, we have steered a steady, middle-of-the-road course somewhere between doing nothing and full-on ESG. At a recent meeting of the investment committee, which I attend as an observer, I gave a presentation together with our colleague Katrine, CIO at PensionsKøbenhavn, the fund with which we have an investment co-operation agreement.
There was a green tinge to the joint presentation that we made about our infrastructure investments, given the focus we have, in any case, on green energy. Katrine talked about the Danish wind farm investments that we have made together, while I discussed our Dutch green energy investments.
At the request of the committee and the trustee board, we also recently commissioned an environmental benchmarking consultancy to measure our carbon position across the portfolio and to benchmark us against similar institutional investors.
A risk specialist from the environmental consultancy gave a lively presentation about “greenstreaming” investment risk by taking ESG factors into account in the overall investment process. Given the look on the committee members’ faces, I think they were a little sceptical. They assessed our portfolio from a range of different perspectives, awarding us a score of seven out of 10 for “internal momentum” with potential for improvement in “cross-stakeholder messaging”. Even I looked a little sceptical at that.
In the car park, Rolf and I stroll past our CEO’s new TESLA. ‘You could say we are highly altruistic with all this green stuff. As a maker of flood protection equipment, Wasserdicht would of course benefit from rising sea levels,’ Rolf says conspiratorially as he unlocks his BMW 7 series. ‘But of course, green investing gets pension funds such good PR these days and you can never have enough of that.’
Pieter Mullen is investment director at Wasserdicht Pension Funds