Hedge Funds

ESG and Sustainability

The rise of ESG factors in investment decision making will have a dramatic impact on returns and opportunities in the 21st century. A recent survey by LGT Capital Partners and Mercer showed that 57% of respondents believe that incorporating ESG standards into investment decisions will raise returns. Just 9% argued they reduce returns on investment.

Top Story

Venture Capital: Revaia, Europe’s Biggest Female-Led VC Firm, Racks Up $160M For Second Fund

December 7, 2023

Revaia, Europe’s largest female-founded venture capital firm, has successfully raised €150 million ($160 million) for its second fund, Revaia Growth II. The funding was secured from sovereign wealth funds, family offices, and institutional investors across Europe, with support from existing partners like Bpifrance and new backers such as mutual insurer Carac and the European Investment Fund.


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More Stories on ESG and Sustainability

The Arms Race in ESG Ratings: S&P Buys RobecoSAM Unit

November 25, 2019

The hot new sector of environmental, social, and governance (ESG) ratings is witness to a lot of deal activity this year. Investors, fund managers, and regulators are pressing for data on companies’ performance on ESG, as concerns mount on sustainability. It’s no surprise, therefore, that S&P just purchased the ESG ratings arm of RobecoSAM, for an undisclosed amount.

Facing Crowded IPO pipeline, Neptune Energy To Tighten ESG Belt

November 25, 2019

A BloombergLaw report said Neptune would explain to investors how its business will weather mounting environmental, social, and governance (ESG) concerns. According to this report, Neptune will publish for the first time, its ESG plan in its Annual Report around April 2020. Readying for an IPO means readying a low-carbon strategy, the article said.

Investors Concerned About Executive Compensation: Report From Farient Advisors

November 22, 2019

Engaged investors continue to be concerned about climate change, gender adversity, and pay equality, says a report from Farient Advisors and the Global Governance and Executive Compensation Group. Investors are perturbed about the disconnect between executive performance and ever-escalating compensation.

Bill Gates-backed Startup Announces Clean Energy Breakthrough

November 21, 2019

Heliogen, a startup backed by Bill Gates, announced a breakthrough solar energy technology that could be a boon for heavy industry. Heliogen uses artificial intelligence and mirrors to reflect and concentrate sunlight to generate ultra-high temperatures. Said to be The Holy Grail of clean energy, it generates no emissions and is cheaper than fossil fuels.

Commissioner Lee Focuses the SEC on a revamp of ESG

November 20, 2019

SEC Commissioner Allison Herren Lee wants the SEC to clarify its role and update disclosure requirements on ESG.
In prepared remarks addressed to the Investment Advisory Committee (IAC), SEC Commissioner Lee drew attention to investors’ growing interest in ESG. The IAC was meeting to consider the topic “Whether Investors Use Environmental, Social, and Governance (ESG) Data in Investment/Capital Allocation Decisions.”

Your ‘Feel-good’ ESG Fund is on a Tear: But Do You Know Why?

November 19, 2019

Investors should examine the underlying holdings of their ESG-focused funds to determine hidden portfolio risk.
CNBC’s Mitch Goldberg warns that a lot of the outperformance in many ESG funds has nothing to do with ESG factors. Instead, the credit for the ESG outperformance should go to the sizable component of technology stocks in these funds’ portfolios.
Technology stocks have significantly outperformed the broad market and maybe the hidden booster to your ESG fund’s performance.

Are Climate Change Disclosure Lawsuits Coming for Asset Managers

November 18, 2019

Mark McVeigh is an environmental scientist from Australia. Although he will not have access to his retirement funds until 2055, he is suing his pension fund. 

How Serious Should We Take ESG Investing in 2020?

November 15, 2019

Sustainable funds are hardly sustainable based on their carbon footprint. The Wall Street Journal reported Wednesday that eight of the largest 10 sustainable funds in the U.S. have oil and gas investments. 

This news comes as a way of criticism has hit the newest – and perhaps surprising fad in institutional investment. ESG funds are booming. They’ve taken in a record $13.5 billion in new money over the first three quarters of the year. That figure comes from Morningstar. But how sustainable are the investments in these funds?

Study: Activist Investing Spurs Innovation in Targeted Companies

November 14, 2019

A research study by Columbia Business School’s Professor Wei Jiang shows that activist investors help the cause of innovation in their companies. Prof Jiang is the Arthur F. Burns Professor of Free and Competitive Enterprise at the University. Third-party interventions can actually increase the longevity and sustainability of a company’s innovation.

CPPIB Reports 2.2% Return in the Second Quarter

November 14, 2019

The Canada Pension Plan Investment Board (CPPIB) reported gains of 2.2% during the second quarter. On Thursday, the nation’s largest public pension fund reported how it delivered the return.

Is Saudi Arabia Running Out of Money?

November 14, 2019

The Saudi Aramco IPO could be a ploy to raise money for a nation under financial duress. That’s the statement from former CIA chief David Petraeus in an interview with CNBC. Petraeus says that the nation needs to list its state oil company on the public markets in order to raise money.

European Money Market Funds and the ESG Juggernaut

November 13, 2019

Goldman Sachs Asset Management tweaks a money management fund for ESG, especially diversity.
Goldman Sachs is heeding the ESG clarion call from investors. The asset manager has introduced environmental, social, and governance criteria in a Euro money market fund.
The Low Volatility NAV money market fund has been “enhanced” for ESG considerations via a two-fold strategy.

Neuberger’s ESG Investing to Include Small Japanese Companies

November 12, 2019

Neuberger Berman, a US private equity firm, is creating a niche ESG fund focused on small Japanese firms.
Neuberger Berman is looking at small (also mid-sized) Japanese companies because they have a lot of ESG catch-up to do.
Compared to similarly-sized companies in the US or Europe, smaller Japanese companies are lagging at ESG practice and reporting.

CEO Firing: McDonald’s Investigation Commenced Weeks Before

November 11, 2019

McDonald’s became aware of CEO Steve Easterbrook’s relationship with a female employee two weeks before his firing on November 1. According to the Wall Street Journal, the company’s general counsel Jerry Krulewitch conducted an internal investigation and informed its board. The company appointed an NYC law firm to assess the risks.

Canada’s CPPIB Boosts Investment in Renewables 100-Fold Since 2016

November 11, 2019

As of June 30, the CPPIB revealed it had $3.02 billion invested in renewable energy businesses. This amount is twice what it was last year. It’s also more than 100 times the amount it invested in the renewables space in 2016.

The Canada Pension Plan Investment Board Pulls the Plug on U.S. Prison Firms

November 11, 2019

The Canada Pension Plan Investment Board (CPPIB) is selling stakes in two American prison companies. ESG expectations and concerns about reputational risk fueled the divestitures.

J. Safra Sarasin’s Flagship Fund Rebranded in Line with ESG Strategy

November 8, 2019

Private banker and wealth manager J Safra Sarin have renamed their flagship fund ‘JSS OekoSar Equity – Global’ to ‘JSS Sustainable Equity – Global Thematic.’
The name change reflects the fund’s ESG investing strategy to include all of the factors relating to the environment, social, and governance.

BofAML: Assets at European ESG Equity Funds Could Rise by €1 Trillion

November 8, 2019

Regulatory compulsions and structural trends will boost assets under management at ESG equity funds in Europe, say BofAML analysts.
In their study titled “ESG Matters – Europe: Great for the world, good for returns,” the analysts foresee a surge of €1 trillion in assets at these funds by 2030.
Further, one in three European equity funds could be ESG-focused by then.

Carlyle Group

David Rubenstein: ESG Will Have a Big Role in Private Markets

November 6, 2019

David Rubenstein said Tuesday that ESG factors now play a big role in how investors allocate capital in the private markets. The Carlyle Group co-executive chairman discussed environmental, social, and governance issues at the Greenwich Economic Forum.

UK Regulator: Fire Fund Managers Who Ignore Climate Change

November 6, 2019

Guy Opperman says we have settled science. Guy Opperman had some tough words for money managers who “ignore” climate change. The U.K. minister for pensions and financial inclusion said pension operators should fire money managers who do not support climate change resolutions. Opperman spoke on the subject at the Association of Member Nominated Trustees’ (AMNT)…

Brown Advisory Launches Global Leaders Sustainable Fund

November 4, 2019

Brown Advisory has announced the launch of the Global Leaders Sustainable Fund under its Irish domiciled UCITS umbrella. The $76 billion company said that the new UCITS Fund adds environmental, social and governance (ESG) screens to its top quartile performing Global Leaders Strategy. According to a press release, the addition of the ESG screens came in response to client demand.

M&A Deal News

CPPIB to Buy Pattern Energy Group for $2.63 Billion

November 4, 2019

The Canada Pension Plan Investment Board (CPPIB) announced plans to buy Pattern Energy Group for $2.63 billion. CPPIB announced details of the deal for the renewable energy giant on Monday. Shareholders will receive $26.75 for the stock. That figure is actually lower than the price the stock traded for earlier in the day. In the final hour of trading on Monday, PEGI stock was off 2.5% at $27.03 per share.  

UBS’ Walsh on ESG: ETFs Can’t Be Subject to A Standard ESG Definition

October 28, 2019

Andrew Walsh is head of passive and ETF specialist sales for UK and Ireland at UBS Asset Management. He gave a pertinent example of the difficulty of applying a standardized, “one-size-fits-all” definition of ESG: Can you cubby-hole companies in the oil and gas sector along with the ones in the tech sector? No, that’s because the metrics for ESG for the two industries would be vastly different.

ESG ETF Inflows Increase in September

October 28, 2019

ETFGI, a global research firm, says the uptick in ESG assets continues to accelerate due to booming investor interest. Global environmental, social and governance assets in ETFs and ETPs have reached $47.33 billion.