Three charities have named Cazenove as the winner of the ESG investing Olympics and awarded the investment manager a £33.5m investment mandate.
The Friends Provident Foundation, the Joffe Charitable Trust and the Blagrave Trust launched the ESG investing Olympics in January. All three have contributed towards the investment mandate.
The aims of the competition were to bring investment management “out of the shadows”, share learning on emerging best practice in the market, and “send a market signal regarding asset owner demand for investment with purpose and expectations for ESG integration and impact”.
There were 60 proposals entered into the process and five were selected to present to a group of mission-led investors, including charities and religious organisations, at the Royal Institution in London in March.
The five finalists ranged from boutique impact managers purposely seeking to invest in solutions, to large managers integrating ESG and seeking to move markets and transnational companies via their stewardship.
The proposals were assessed for intentional social and environmental impact, high standards of ESG integration covering exclusion, engagement and its escalation, voting record, in-house expertise and impact reporting.
“We hold a strong belief in the potential of ‘investing to engage’ and ‘radical transparency’ to effect change in mainstream financial markets,” said Colin Baines, investment engagement manager at Friends Provident Foundation.
“In the spirit of the ESG investing Olympics, which set out to bring investment management out of the shadows and send a clear market signal for higher ESG standards, we will work with Cazenove to continually raise market standards and best practice, and will regularly report on our experience.”
As well as naming Cazenove as the winner, the charities also named EQ Investors as runner-up and commended its “best in class” credentials as a boutique impact manager and “new disruptor”.
Overall trends
In the autumn, Friends Provident Foundation will publish a “state of the sector” report on ESG market trends and remaining gaps identified from analysis of the 60 proposals.
“I don’t want to give too much away but one positive trend identified is fossil fuel divestment becoming commonplace,” said Baines. “Gaps in the market include less developed integration of the ‘S’ of ESG in stock selection, and weak shareholder engagement escalation policy and practice.”
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