Head of the Financial Institutions sector team at the CDC Group, Maria (Largey) Smith, is interviewed by John Teehan, CFA Portfolio Manager at Redwheel (formerly known as RWC partners) in this new podcast. Climate change through the eyes of an impact investor delves into how the world’s first leading impact investor, CDC Group is tackling one of the biggest global development challenges.
CDC Group holds over 70 years’ experience as a development financial institution wholly owned by the UK Government. They invest in flexible capital to support private sector growth and innovation in developing countries. Maria is responsible for the equity FI portfolio across Africa and South Asia and in this podcast, she shares how CDC Group is helping meet countries financing needs for improving infrastructure and enterprise.
John probes Maria on the CDC Groups capital structure, and measurements that impact investors can have on climate change. Maria discusses how the CDC is focused on business growth to help lift businesses out of poverty with the aim to generate returns that will continue making an impact. With a portfolio of over £7 billion, the institution is operating in 5-year strategy period agreed by shareholders, with the target of creating a significant step-change approach to tackle climate change.
Maria reveals plans to embark on the new 2022-26 strategy “we’re aiming to invest one and a half to two billion per annum, over the investment period…this new strategy builds on the mandate and track record over the previous period but, enables to go a little bit further and a little bit deeper in particular in two areas: one is increased focus in climate finance which we will talk a little bit about today, including green infrastructure and the second is new investments in digital infrastructure.”
Learn how impact investors operate today and their proposed solutions to reduce the impact of climate change tomorrow.
Record date: December 2021
Influence Map ranked Legal and General Investment Management (LGIM) at the top of global asset managers for climate engagement and climate resolution votes, with a score 99% and a performance band of A+. In fact, these scores date back to 1980 and have always been a part of LGIM’s approach to minimum standards in responsible investing.
John Teahan, Portfolio Manager at RWC Partners interviews Sonja Laud, Chief Investment Officer at LGIM on LGIM’s leading work on climate issues. Said to have recorded an AuM of £1.6tn in 2020, LGIM has made it clear every engagement and every vote really matters.
As the former Head of Equity at Fidelity International, Sonja Laud and John Teahan worked together on portfolios and discuss how LGIM has made climate an important part of responsible investing, from embedding it into the firm’s culture, to acting on behalf of clients.
The conversation focuses on the companies’ powerful strategies to influence and how LGIM' Stewardship and Investment teams operate. In practicing ESG Sonja share’s how it provides a positively holistic view of a company. By moving away from just looking at the P&L, balance sheet, and doing fundamental analysis as it’s always been done, ESG integration can add a broader perspective.
Sonja says, ‘We’re doing this because, point one we feel we have a responsibility to address big societal issues. Point two, and maybe more importantly we believe that these issues do carry financial materiality, and that means you have to include them in your investment process in order to deliver attractive and relevant investment propositions to your clients.’
Listen to this podcast to hear from Sonja Laud on their leading the LGIM ESG strategies and high-level framework to responsible investing.
Record date:15 October 2021
Record date: 22 July 2021
As an investment professional it’s important to gain an understanding of what is meant when talking about climate change and the benefits of shifting existing behaviours. In this podcast explores the basics to take a high-level view of the climate science and what it means for the industry as a whole.
Climate models, whilst varied, are all pointing in the same direction… a global climate that is more volatile and unpredictable that will negatively influence the human race. The Paris Agreement sets out the foundations to tackle this, with many individuals, companies and governments asking how they can achieve net-zero by 2050 or sooner.
Record date: 26 February 2021
Whilst there is a lot of focus on mobilising climate finance in the direction of the green economy, a shortage of concrete data and definitions are causing a lack of awareness around the investment opportunities available. For years, green was loosely defined, based on concepts rather than a specific industrial system. This is where Lee Clements and FTSE Russell step in.
Through the Green Revenues 2.0 data model, they have identified more than 3000 global companies that are participating in the green economy, equating to an estimate of $4 trillion worth of market cap or 5-6 percent of all listed global equities. FTSE Russell have developed a structure, measurement methodology and process to help truthfully size the growing green economy.
Client interest has significantly grown, with investors starting to look beyond excluding risk areas such as coal mining or gas, and shifting their attention to growth opportunity areas, for instance renewable energy or electric vehicles. This interest has been further stimulated by regulations similar to the EU Taxonomy.
Record date: 23 February 2021
Right now, millions of people in the UK regularly experience hunger. Yet tonnes of surplus fresh food is thrown away every day. Mark Curtin and his team at the Felix Project have set out to change this.
The UN Sustainability Development Goals (SDGs) are looking to halve food waste by 2030, with the UK making significant progress. There is a growing awareness, from all types of investors, about the issue of food waste and the business benefits that can be realised when providing solutions to tackle it.
Targeting investments in sustainable food companies and in businesses that can demonstrate innovation in resource efficiency and nutrition. Especially those who invest in technology that assist in reducing waste in their production, monitoring, packaging, storage, harvesting and distribution channels.
In simple terms, waste negatively impacts margins in any business, and reducing this waste will improve profitability and investor returns. What can those working in investment do to support this?
Record date: 23 March 2021
A recent Professional Investor article, Asset managers still slow on climate change, revealed that a substantial number of asset managers are still struggling to engage with climate change challenges and research conducted by the CFA Institute shows that, of 305 respondents from across the investment industry, only 40% are currently incorporating climate change into the investment process, even though three-quarters of respondents feel that climate change is an important issue for investment management.
2020 - the boom year for ESG
This last year has seen phenomenal growth with ESG investing and there has been a renewed focus on these high-performing strategies. Bernstein estimates that £200bn flowed into ESG strategies in 2020, compared to £100bn being pulled from all active funds. Why was 2020 such a pivotal year for ESG investing?
A combination of factors has contributed to these successes, from the doubling of companies declaring net zero targets, increased regulation (EU Taxonomy, SFDR) and a societal recognition and shift towards environmental issues. On top of this COVID-19 gave ESG an unexpected boost with the UK governments mantra of ‘Building Back Better’ cutting through with the general public and investors alike.
There has been a real wake up call for value investors to engage with ESG issues, to attract and win capital for their businesses and the companies they invest in. For Teahan and his organisation RWC Partners, it is not only about integrating ESG strategies into their portfolios, but it’s about going even further and becoming impact investors.
Record date: 9 April 2021