Why has making an impact been made so hard? - Natixis Investment Managers

As if the regulatory burden that has emerged since the 2008 Global Financial Crisis wasn’t enough, today’s trustees of the UK’s pension schemes are also expected to assess the financial impact of climate change. Yet, without an accepted definition of how ESG can make a difference, it all seems just a tad unfair but could be made a lot simpler.

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... Despite an inordinate amount of words written by sustainability advisers over the last 10 years, Trustees are still none the wiser about how to account for climate change in their scheme’s SIPs. Now regulations have been expanded to include Impact Investing, a simple philosophy that offers Trustees the ability to influence social good, but where purists insist on a conflict between intentionality and the priority for investment returns This threatens the added burden of another raft of definitions and measurements that risk disenfranchising LGPS (in particular) from benefiting their local communities. On the other hand, a strategy such as AEW’s UK real-estate strategy can have a significant social impact while meeting fiduciary investment objectives, without the need to be labelled as a ‘social impact fund’. AEW believes that enabling and not labelling should be the defining force for good.

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