April 2022

Environmental, Social and Governance Considerations in Pension Plans
28Apr

Environmental, Social and Governance Considerations in Pension Plans

By Paul Williams & Elizabeth Harker Speaking at the United Nations Climate Change Conference ("COP26") in October 2021, the UK Secretary of State for Work and Pensions, Thérèse Coffey, said that pension schemes can become a "superpower" in fighting climate change and propelling the world to net zero. But to what extent does the legal landscape within which pension schemes operate allow them to perform this role, and indeed to what extent should they be performing this role? Here in the...

April 28, 2022
Articles, Investment, Pension Management, , ,
Read more...
26Apr

UK. Two thirds of investors prioritise returns over ESG

Two thirds of UK retail investors do not mind if their investments are sustainable but are instead focused on the returns they bring in. Some 66 per cent of the 1,000 investors surveyed by Charles Schwab UK said they are purely focussed on maximising returns. Just under half (44 per cent) of respondents said they regularly consider environmental, social and governance factors when making a new investment. This drops to 28 per cent among the ‘Boomer’ generation (aged between 57 and 75),...

April 26, 2022
News, , ,
Read more...
26Apr

UK. Aegon investing £3bn in BlackRock ESG range

Aegon is investing £3bn of its default funds into a range of ESG index funds launched by BlackRock. The firms worked together on the iShares range, which includes six ESG equity income index funds which track Morningstar’s regional and country-specific indices. The change means that ESG exposure in the Aegon workplace default fund will double to 60 per cent for investors in the growth stage of their retirement savings, and to 40 per cent for those in retirement. A number of other...

April 26, 2022
News, , ,
Read more...
20Apr

What does the future of ESG disclosure look like?

For trustees, the rise of environmental, social and governance factors within the pensions sector has resulted in a shift in agendas, with compliance and regulatory matters growing in prominence. Fifty-three per cent of trustee boards now consider ESG an important agenda item, according to research produced by the Pensions Management Institute and BMO Global Asset Management in 2021. This is up markedly from 2020, when ESG was important for just 29 per cent of trustee boards. With current regulatory shifts and changes...

April 20, 2022
News, ,
Read more...
20Apr

ESG, SRI, Impact Investing: What Are They, How to Get Started, and How Funds Have Performed

What is ESG, SRI, and impact investing, and how have ESG funds performed? ESG, SRI, and impact investing may seem like last decade's buzzwords, but they now have enough capital and data behind them for investors to pay attention to. ESG stands for environmental, social, and (corporate) governance. ESG investors look for companies that lead in those areas in addition to strong financial returns. Broadly speaking, ESG investors, socially responsible investors (SRI), and impact investors invest in companies that are both financial...

April 20, 2022
News, , ,
Read more...
15Apr

Swedish regulator to screen funds for ‘green painting’

Sweden's financial regulator said it will start reviewing funds to enforce new sustainable regulations and to prevent "green painting." The Swedish Financial Supervisory Authority, or Finansinspektionen, said it will review "whether the information provided about the funds that are classified as most sustainable meets the strict requirements" of sustainable finance disclosure regulation rules implemented in March 2021. In a notice on its website Tuesday, FI said that as demand for green and sustainable funds increases rapidly, "this entails the risk of...

April 15, 2022
News, Slider, , , , ,
Read more...
14Apr

UK. Can retirement savers make their pension greener?

Pension savers are apparently turning their attention towards environmental, social and governance factors amid the increasing prevalence of ESG investing. Two-thirds (67 per cent) of consumers believe it is important to consider ESG factors before investing, rising to seven in 10 (72 per cent) for those with a pension, according to a survey from Aviva last year. When it comes to defined benefit pension funds, it will be down to the trustees who take advice from a consultant to decide what...

April 14, 2022
News, , ,
Read more...
Retirement Plan Participants Want Their Investments to Make a Difference
12Apr

Retirement Plan Participants Want Their Investments to Make a Difference

Plan sponsors might consider building an investment lineup to meet the growing demand for sustainable options from defined contribution retirement plan participants. Nearly three-quarters (74%) of retirement plan participants said they would increase their contribution rate if offered sustainable investments, compared to 69% in 2021, according to the Schroders 2022 U.S. Retirement Survey. They said they want their investments to be aligned with their values (87%), and that they see environmental, social and governance investments as a driver of performance...

April 12, 2022
News, , ,
Read more...
11Apr

The Association between Mandated Environmental Liability Recognition and Voluntary ESG Disclosure Quality

By Daniel A. Bens, Cai Chen & Peter R. Joos We examine the association between mandated Asset Retirement Obligations (ARO), i.e., environmental clean-up costs of normal operations estimated on the balance sheet, and the quality of voluntary ESG disclosures. We hypothesize that when firms recognize larger AROs with higher accuracy that this effort will spillover into enhanced voluntary disclosure of a broad range of ESG outcomes. Empirical evidence supports this hypothesis. In a sample of environmentally sensitive industries, we find...

April 11, 2022
Articles, Investment, Pension Management, ,
Read more...
US. Window opens to increase ESG investments in DC plans
11Apr

US. Window opens to increase ESG investments in DC plans

Retirement plan service providers are betting that demand for ESG investments in plan menus — until now muted — is set to grow. Take, for example, Morningstar Inc. In October, the company's investment management arm announced it had teamed up with Plan Administrators Inc., a retirement plan administrator and record keeper, to launch a pooled employer plan this year featuring an investment menu made up almost exclusively of ESG funds. Five months later, Transamerica Corp. followed suit with the launch of...

April 11, 2022
News, , ,
Read more...