This Livery Climate Action Group seminar was held on 12th September 2023. It was aimed mainly at Chairs of Livery Company charitable trusts and was very well attended.
We were welcomed by our host Richard Sankey, Client Investments Director, CCLA Investment Management, at their offices in Angel Lane, London, EC4. CCLA is in the unique position of being owned by investment funds of their three client groups – churches, charities and local authorities. They are the spirit of a mutual in the body of a commercial private limited company.
After an introduction from Alderman Alison Gowman, Henry Pollard, Master of the Guild of Investment Managers and Board member of The City of London Pension Fund, outlined the plan for the evening.
Tessa Younger, Stewardship Lead at CCLA Investment Management, offered insights into how to transition charity and Livery funds to net zero, by decarbonising our portfolios. Find out if your external advisors ask questions at company AGMs about targets and timetables and then vote on the outcomes. A slide showed how CCLA listed equities came out significantly lower on their weighted average intensity portfolio ceiling relative to leading indices. Investors could also engage with companies, and press policy makers to push forward enabling legislation and to allocate capital to new investments and technologies. They could consider a collaborative approach, partnering with other investors to leverage engagement.
Anita McBain, Tessa Younger, Eoin Murray and Henry Pollard
Our second presenter, Eoin Murray, Head of Investment, Federated Hermes Limited spoke about the end of ESG (environmental, social and governance analysis) and the application of economics to biodiversity loss in the Dasgupta Review. The speaker referenced a 2023 paper by Alex Edmans of London Business School that pointed out that ESG is both extremely important … and … nothing special. ESG is critical to long term value. It is not niche and it is not a special category – it is just sensible investing. What we really want are great companies, not just companies that are great at ESG reporting.
Our final speaker, Anita McBain, Head of ESG Research, EMEA and Managing Director at Citi Research, listed five reasons to integrate ESG as identified by Citi’s 2023 investor survey: financial materiality, client mandate, regulation, fiduciary duty and investment opportunity. Climate change, energy transition and biodiversity loss are the top three investor trends as identified by the 2023 Investor Survey. Biodiversity-related risk will become financially material this decade. Tackling climate change and biodiversity loss is. essential in mitigating future risks such as: physical risk, transition risk, stranded assets, litigation risk, reputational risk and ultimately systemic risk. There is an emerging science-based mind-set within responsible investment teams digesting scientific research with the arrival of new skills. We underestimate our economic dependence on nature, with reference once again to the Dasgupta Review.
Henry Pollard ran a lively Q&A session and discussions continued over the refreshments and canapés.
Peter Alvey
Deputy Chairman, Worshipful Company of World Traders Charitable Trust