IRELAND TAKES A LEAD IN SUSTAINABLE & RESPONSIBLE INVESTMENT
In 2015, Goldman Sachs declared that sustainable investment (environmental, social and governance – or ‘ESG’) has now become mainstream – and that awareness of ESGfactors is a minimum requirement for investment. It called it the ‘new bottom line’. Goldman is not the only player to recognize the trend.
Citi and Morgan Stanley have developed similar plans and so too has Bank of America, which is targeting $125 billion in low-carbon business by 2025 “through lending, investing, capital raising, advisory services and developing financing solutions”. Here in Ireland, AIB has just appointed Ray O’Neill as its first head of sustainable business.
It’s clear that the world’s capital markets and major global investors have woken up to the challenge of climate change, environmental sustainability and the role of finance in helping solve society’s problems.
On the client side, the United Nations-backed Principles for Responsible Investment, the leading forum for institutional investors, now has a signatory base in excess of US$59trillion. This feeds directly into how money is managed along the investment chain – so investment banks and asset managers are becoming responsive to client demands to raise their game on sustainability.
Ireland is already a domicile to a surprising range of responsible investment funds. Hermes, Ownership Capital, Generation, Sarasin and Sonen Capital count among sustainable and responsible funds already domiciled here. BlackRock Renewable Power, Brookfield Renewable and Kleinwort Benson are amongst an emerging cluster managing capital guided by responsible and sustainable investment principles.
It is a start with potential for exponential growth.
In an exciting development and mirroring international developments in other countries, Sustainable Nation Ireland has set up a new forum to accelerate this growth – the Sustainable and Responsible Investment Forum Ireland (SIF Ireland). The Forum will support the advancement of responsible and sustainable investment practices here in Ireland, while internationally promoting Ireland as a location of choice to domicile / manage such assets from.
Joining forces with other global networks like the UN Principles of Responsible Investment and EuroSIF (Europe’s umbrella body for sustainable investing) to learn from existing players, the Forum is chaired by Terence O’Rourke, former Managing Partner KPMG.
Offering a platform for market players with a substantial interest in responsible and sustainable investing to come together, the Forum aims to support and advance the sustainable development of both the Irish finance and investment sector and spread and exchange experiences among the members of the Forum as well as to facilitate a diversified debate on ESG.
It is open to institutional investors (pension funds, unit trusts and others) as well as other organisations with activities in Ireland that have a substantial interest in ESG. The Forum will be officially launched on the 28th April.