Responsible Investing: Ten summer highlights

The many effects of COVID-19 meant there were particular challenges to address around ESG (Environmental, Social, Governance) themes over the summer.

Yet even as we engaged with topics like labour rights, we remained keenly focused on the climate issue.  Reading the news, how could we not? Record temperatures, record storms and the splitting of Canada’s last complete ice shelf showed how urgent the problem is.¹

So we wanted to report on our Responsible Investing (RI) progress through July and August. Here’s our RI ‘top ten’ for summer 2020:

1. 1. 1. Amplifying our voice: IIGCC Net Zero Investment Framework
         We’ve been working hard on this project for more than a year and, in August, the IIGCC Net Zero Investment Framework launched, showing “what a Paris-aligned portfolio actually looks like”. We have also publicised the consultation.
      2. Exam grades: UN Principles for Responsible Investment Assessment Report
         As in 2019, Brunel’s UNPRI scorecard showed us beating peer averages in all categories. One highlight was an A+ in the (voluntary) Private Markets category.
      3. Rewriting the rulebook: US Department of Labor Consultation response
         We wrote to express deep concern over a proposed US law obliging pension funds to prove they are not sacrificing returns by focusing on ESG criteria. US investor groups wrote to thank us. (See also State Street’s intervention.)
      4. Free to work: MHS-UAE collaborative engagement
         We signed a letter asking 54 companies operating in Gulf states to detail their migrant worker protections, after reports of forced labour & modern-day slavery. Signatories represent $3 trn+.
      5. Role-play: UNPRI coverage for a Brunel client workshop
         See ‘Sustainable Development Goals as a tool for Strategic Asset Allocation’
      6. Minority report: Investor Alliance for Human Rights: Guidance on Xinjiang
         Brunel welcomed the Alliance’s publication of investor guidance on Xinjiang in northwestern China, home to the Uyghurs, and is supporting its work and engagement on these themes.
      7. Climate risk management: Ceres
         Ceres, the US investor network, published ‘Portfolio Climate Risk Management case study’, which took Brunel’s approach as a case study.
      8. Video view: LGPS Scheme Advisory Board
         We participated in an SAB webinar on ESG initiatives. Faith Ward spoke about water, plastics (the ‘E’), racial & health equality, modern slavery (‘S’), and overboarding, pay structure and tax (‘G’). We also support SAB in developing its RI A-Z.
      9. Rain check: BlackRock engagement
         Following our engagement, we welcomed BlackRock’s public stance over voting against 53 companies and putting another 244 on watch for inadequate action on climate risk. We continue to engage, especially on ‘Talk about Black’ and taking action on racial inequality.
      10. Oil check: BP and decarbonisation
          Working on behalf of Climate Action 100+ (the largest global coalition for climate engagement), Federated Hermes EOS, our partnership’s engagement and voting provider, has led engagement with BP and 20 others. We were therefore delighted to see the recent BP announcement, which gives us some cause for cautious optimism over decarbonisation in the sector.

¹ Sources: CNN, The Economist, National Geographic, Colorado State University