I do not have access to a lot of data, which is part


of the problem. Andrew Cole, BESTrustees


Loriot-Boserup: Forward looking metrics such as implied tem- perature rise metrics are incredibly important in the transition to a low-carbon economy. However, these are only as useful as your understanding of the methodology, its assumptions and limitations behind them. These tend to vary significantly between data providers. High-level statistics are usually not that useful, but they guide you to the portfolios you should focus on. Once you have the implied temperature, check that specific sectors are within their 2oC threshold or the carbon budget. Then you can dig into specific issuers. Rawson: If I could leave one message on the table it would be for all parts of the value chain to send signals through their con- sultants to managers that they have a stewardship responsibili- ty and should be engaging with high emitting companies. Gopinathan: Engagement impact is an area which is less focused on. There is talk around how greenwashing relates to carbon metrics and disclosure, but quantifying engage- ment impact and keeping the feedback loop going to get enough data to see what has been accomplished is crucial. We need more clarity here. You have made three calls to a company this year, but what does that mean? What change have we affected?


How much weight do you put on data when making investment decisions, Andrew? Cole: I do not have access to a lot of data, which is part of the problem. So, I am looking for guidance. Trustees engage with managers maybe once a year, so it is difficult to get into the granularity of what they are doing. It is a complex area and is why there are a lot of firms providing information about how managers are performing. Some are doing it in a thoughtful way and some are not, but it costs money. We are here to provide pensions for our members and so want to minimise costs. If I spend £20,000 for a scheme with £5m in assets to hire a consultant, it is something we think about. This is why my big plea is to have clarity and uniformity in data, to have analysis that is equivalent to Moody’s and S&P for the smaller schemes who do not have the resources to cut through everything.


There are lots of different acronyms and data firms are doing a lot of good work, but I am trying to unify that into a simplified way, because if I am in a four-hour board meeting, only 30 minutes could be allocated to investment. People are willing to consider these issues, but there is a time limit. It is an important risk, so simplifying it for our benefit would be great.


Feb 2022 portfolio institutional roundtable: Sustainable investing 21


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