Many funds are looking to managers to almost tease out what their beliefs are. Many are looking for sustainability, are thinking about their long-term horizons, they want to buy and hold. They are not yet in a place where they understand how they can measure what sustainability means for them as a pension fund, and they are looking for advice on that. At the other end of the spectrum, there are clients who are clear about what it is that they are looking for. They are looking for a manager that can deliver a product that fits that bill and is not necessarily a re-badged product.
PI: We have talked about the questions you ask your managers, but what process do you go through when choosing a manager? Mason: We look at if managers have a policy, how they incorporate ESG factors, their engagement and voting record, their reporting to clients and how they approach climate change. Finally, we look at whether someone can validate their responsible investment practices. Werf: How helpful are the PRI Transparency Reports in assessing asset managers? Mason: We find the United Nation’s Principles for Responsible Investment (PRI) Assessment Reports more useful. You can see how a manager measures up to a PRI assessment system. Curtin: I always ask for the private Transparency Report alongside the assessment report. The number of times I get the public report sent to me. I want the full details. What are they hiding? I find those two next to each other useful, especially if the managers are PRI signatories.
“What we should be doing as investors is think about this being an inherent component of the risk-return piece.” Anita Bhatia, Guy’s and St Thomas’ Charity
Anita Bhatia
14 November 2019 portfolio institutional roundtable: Responsible investing
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