UK – Hermes, manager of the 48 billion-euro BT Pension Scheme, has chosen Innovest Strategic Value Advisors to provide company and industry ‘sustainability’ research.
Innovest said Hermes would use the research to focus on companies’ risk, performance and strategic positioning with regard to environmental, social, and strategic governance issues.
It added that its ratings and research would be used as an overlay to Hermes’ existing process and aid engagement.
"Hermes believes that well-governed companies will achieve better financial returns than their peers in the long-term as their boards will better anticipate and react to the challenges of business,” said Nick Mustoe, Hermes’ chief investment officer.
“Innovest's research helps ensure that we can identify those companies that are performing well on those measures, and those that need encouragement to do so."
“I would expect that, over time, other major institutions will follow Hermes’ lead in recognizing the financial importance of superior performance on environmental, social, and governance matters, and integrate this type of analysis into the core of their investment process,” said Innovest’s chief executive Matthew Kiernan.
Dutch civil service pension fund Stichting Pensioenfonds ABP has a 10%-15% stake in Innovest.