Three-year study seeks to measure impact of ESG investing
The UK’s University of Cambridge has allied with Pacific Investment Management Co, Allianz Global Investors, Aviva Investors and others to launch a three-year study on the use of sustainable investment to meet global social and environmental challenges in the coming decades.
The study, to be carried out by the newly formed Investment Leaders Group (ILG), will seek to determine how investors can work with ESG principles to both maximize financial gains and make sustainability ‘an integral part of the investment process’.
‘The caliber of the participants in the ILG and its collective ambition are both very high, which tells you something about the importance of this topic,’ says Dr Jake Reynolds, head of the Cambridge team working with the ILG, in a news release. ‘By starting with the fundamentals from the ground up, we have an opportunity to put the value of sustainable investment beyond doubt.’
The University of Cambridge Program for Sustainability Leadership (CPSL), which will host the group’s secretariat, says it has support at the ‘most senior levels’ of the 12 major investors participating in the studies, including Zurich Insurance Group, Standard Life Investment, Natixis Asset Management, Nordea Life & Pensions, First State Investments, the Chandler Corporation, TIAA-CREF Asset Management and PensionDanmark.
The work of the ILG will take the form of two major ‘workstreams’, according to the group’s website. The first workstream seeks to develop a model of responsible investment that ‘mainstream investors can rapidly understand’ and to ‘explain how investment decisions create or inhibit long-term, sustainable value creation in the real economy.’
The second workstream will seek to better measure and communicate the impact of responsible investment and help investors better understand the impact of their investment decisions.
‘Pursuing environmental and social goals does not have to preclude robust returns on investment,’ CPSL’s Carlos Joly says. ‘On the contrary, we can create a virtuous circle, whereby considering ESG factors in investment decisions can drive both economic prosperity and societal well-being. That is the only secure basis on which business and long-term investment can flourish.’
