Lazard Asset Management (LAM) announced the appointment of Evie Paterson as a Portfolio Manager/Analyst on Lazard’s global sustainable equity investment team.

In her new role, Paterson will help manage the Lazard Global Sustainable Equity strategy, an actively managed portfolio that invests in companies whose products and services support the transition to a more sustainable world and drive high or increasing financial productivity. She will be based in London.

Louis Florentin-Lee, Managing Director and Portfolio Manager on the Global Equities team at LAM said:

“As active managers, we are committed to our role as stewards of our clients’ capital. Evie’s sustainability expertise will greatly enhance our team and bring long-term benefits to our clients.”

Prior to joining LAM, Paterson served as Senior Research Analyst at Impax Asset Management, where she was responsible for generating new investment ideas for Impax’s environmental and sustainable equity strategies. In addition, she was a member of the portfolio construction teams for the $12 billion Global Opportunities strategy.

On LinkedIn, Paterson wrote:

“I am looking forward to working alongside Louis Florentin-Lee, Barnaby Wilson and the global research team, investing in financially productive companies whose products and services support the transition to a more sustainable world.”

A group of 27 institutional investors representing more than $4 trillion in assets under management announced today that they have co-filed a shareholder resolution at Shell, urging the energy giant to set Paris Agreement-aligned medium-term target to reduce emissions arising from the use of its products.

The resolution, led by oil and gas-focused shareholder activist group Follow This, was filed by investors including Amundi, NEST, Scottish Widows and Candriam. Collectively, the investor group owns approximately 5% of Shell stock.

Diandra Soobiah, Head of Responsible Investment at NEST, said:

“We urge Shell to set a credible scope 3 absolute emissions target. This would demonstrate leadership, show Shell is serious about transitioning its business, and play a role in generating real-world change.”

The resolution calls on Shell to align its medium-term target for reductions in Scope 3 emissions from the use of its energy products with the goal of the Paris Agreement, which aims to limit global warming to well below 2°C, and to pursue efforts to limit the temperature increase to 1.5°C. The resolution also states that it leaves the strategy for achieving the targets up to the board of the company.

Follow This led a group of shareholders last year in filing a similar resolution, which received 20% support at Shell’s 2023 AGM. The updated resolution incorporates key changes, including replacing last year’s “2030 target” with a less prescriptive “medium-term targets,” and a rewritten supporting statement focused solely on emissions.

Mark van Baal, founder of Follow This, said:

“Large shareholders hold the key to tackling the climate crisis with their votes at shareholders’ meetings. Shell will only change if more shareholders vote for change. The resolution is designed to give Shell a shareholder mandate to drive the energy transition.”

In 2020, Shell announced a commitment to achieve net zero in its operations by 2050, and in 2021, the company launched its “Powering Progress” strategy, detailing how it will achieve its target to be a net-zero energy business by 2050 across Scope 1, 2 and 3 emissions, with initiatives including investing in renewable and clean energy solutions.

While the company has set 2030 targets to reduce its Scope 1 and 2 emissions, it has avoided setting an interim Scope 3 target. Scope 3 emissions represent more than 95% of the company’s carbon footprint, with “use of sold products” accounting for approximately 74%.

In the company’s “Energy Transition Progress Report” released last year, Shell Chairman Andrew Mackenzie said that “the Board has considered setting a Scope 3 absolute emissions target but has found it would be against the financial interests of our shareholders and would not help to mitigate global warming.” Shell added that in order to implement a more ambitious Scope 3 target, the company would be required to reduce its sales of oil and gas products, which in the absence of a change in customer demand, “would effectively mean handing over customers to competitors.”

In a statement provided to ESG Today following the announcement of the resolution, a Shell spokesperson said:

“Shell’s Board has previously advised shareholders that the Follow This resolution was unrealistic and simplistic, that it would have no impact on mitigating climate change, have negative consequences for our customers, and was against the interests of the company and our shareholders.

“Continued, targeted investment in oil and gas will remain necessary to meet global energy demand over the coming decades as the world transitions to a lower-carbon future.”

Global growth equity investor General Atlantic announced today the acquisition of sustainable infrastructure investor Actis. Following the acquisition, Actis will become the sustainable infrastructure arm within General Atlantic’s global investment platform.

The move marks the latest in a series of moves by major asset managers to boost their capabilities to target a rapidly growing infrastructure opportunity set driven by themes including energy transition and decarbonization, including last week’s acquisition by BlackRock of infrastructure giant GIP for $12.5 billion.

According to General Atlantic Chairman and CEO Bill Ford, the acquisition comes amidst a “global paradigm shift toward sustainability,” which will require “an economic transformation and a capital investment on a massive scale.”

Ford added:

“With the addition of Actis, we are taking a significant step forward to add a sustainable investment capability which positions General Atlantic to capture this opportunity set for our investors.”

Founded in 2004 as a spin-out from UK development finance institution CDC Group, London-based Actis has grown to more than 140 investment professionals across 17 global offices, with approximately $12.5 billion in AUM, and over $25 billion in capital raised since inception, targeting investments in critical infrastructure across key themes including energy transition, digital transition, and supply chain transformation.

Following the acquisition, General Atlantic will manage approximately $96 billion of AUM across sustainable infrastructure, real estate, growth equity and credit. The sustainable investment unit will continue to be led by Actis Chairman and Senior Partner Torbjorn Caesar, and the firm will retain the Actis brand.

Caesar said:

“We are very excited to be joining forces with General Atlantic. The combined firm brings together distinct but highly complementary strategies that unlock long-term value for our investors across key structural themes including the energy transition and digital transition.”

Financial terms of the acquisition were not disclosed. The transaction is expected to close in Q2 2024.

Investment management firm Fidelity International announced today a new focused sustainable investment approach, targeting four systemic themes, including nature loss, climate change, strong and effective governance, and social disparities, which will drive the firm’s engagement approach towards influencing positive change.

According to Fidelity’s Chief Sustainability Officer Jenn-Hui Tan, the four focus themes were selected “as these present the most significant systemic risks for our economic and social systems.

Tan added:

“Failing to address these issues or looking at each issue in isolation will prevent us from collectively transitioning to a sustainable economy and will negatively impact portfolios.”

Fidelity’s focus on nature loss follows the recent launch in late 2023 by the firm of its Nature Roadmap, outlining the company’s approach to the integration of nature in its sustainable investments and stewardship processes. The firm is also a foundation member and signatory of the Finance for Biodiversity pledge, a collaboration of more than 150 financial institutions representing more than $22 trillion in assets under management, committed to protect and restore biodiversity through their financing activities and investments, sharing knowledge; engage with companies, assess impact, set targets and reporting publicly on these activities before 2025. Under its new sustainable investment approach in 2024, Fidelity said that it will address nature loss issues through its engagement activities, and vote against companies in high-risk sectors that fail to meet expectations on deforestation-related practices and disclosure.

On the climate front, Fidelity said that it will continue to reinforce its approach based on its goals, which include achieving net zero across its investment portfolios by 2050 and halving portfolio carbon footprint by 2030. The firm said that it aims to champion further developments in transition finance, including innovation in sustainable debt instruments, and that it will seek regulatory engagement opportunities encouraging governments to close policy gaps to make green technologies cheaper, and with regulators working to effectively channel transition financing.

Fidelity’s social disparities efforts will focus on the Just Transition, with the firm noting that an unintended consequence of initiatives to decarbonize could be increased inequalities, which could “impede climate action and potentially negatively impact individual companies’ prospects, and investors’ portfolios overall.” The firm said that it will utilize active stewardship in 2024, particularly in its thermal coal engagement programme, to support social transitions in communitie that require it most. Fidelity has committed to phase out investment in thermal coal by 2030 in OECD countries and in the rest of the world by 2040.

In its efforts to target “strong and effective governance,” Fidelity said that it will intensify its dialogue, and utilize voting and shareholder resolutions in situations in which companies’ governance-related actions and efforts are deemed inadequate, with a focus on issues including board effectiveness, corporate culture and behaviour, remuneration and shareholders’ rights and transparency. 

Tan said:

“In 2024, Fidelity will strive to amplify its active ownership approach as a positive force for driving sustainable business practices in the companies we invest in. In parallel we will continue to contribute actively to the development of key regulations such as SFDR and the implementation of regulation coming into force this year such as CSRD, which we think will be essential for encouraging and harmonising sustainable investing across the industry.”

Global private markets investment manager Flexstone Partners announced the appointment of Samira Boussem as Managing Director & Head of Sustainability, with responsibility for driving the firm’s sustainability strategy. based in France.

Flexstone is a majority owned affiliate of Natixis Investment Managers, providing investment management and advisory services across global private markets to institutional investors, with a focus on on lower, middle market buyouts, growth equity, and emerging managers in the US, Europe, and Asia.

Based in France, Boussem will lead Flexstone’s sustainability strategy and responsible investment approach, focusing on developing Flexstone’s in-house ESG investing framework, stewardship strategy, and product offering. She will report to Eric Deram, Managing Partner at Flexstone Partners.

Deram said:

“As Flexstone’s clients continue to develop sustainable investment strategies, we are thrilled to have someone as experienced and talented as Samira leading this effort. Samira not only brings a vast breadth of knowledge in the world of sustainable investing, but also leadership experience in the asset management industry as we continue to think about new and interesting ways to integrate sustainability into our investment practices.”

Boussem, who joined Natixis Group in 2005, has held several leadership positions with the organization, including most recently serving as Head of ESG at Natixis Investment Managers Solutions where she led all the ESG topics. She was also part of the Sustainable taskforce at Natixis Investment Managers, helping affiliates define their Sustainable journey, in line with the group ESG ambition. She has also worked as Senior Risk Manager within the investment bank and at Natixis AM and as a consultant within the Portfolio Consulting Group of Natixis Investment Managers helping clients in their portfolios’ construction.

In addition to her role at Flexstone, Boussem teaches Sustainable investing at Université Paris Dauphine—PSL.

Boussem said:

“Flexstone’s global reach presents a unique opportunity to make a positive impact and to lead on a variety of sustainability-related issues. I am excited to be working with Flexstone’s global team to drive impactful change, and to integrate the principles that both benefit our clients and also contribute to a more sustainable future for all stakeholders involved.”

Investment giant BlackRock announced today the acquisition of infrastructure investor Global Infrastructure Partners (GIP) in a cash and stock deal valuing the company at $12.5 billion, citing emerging long-term opportunities in areas including decarbonization, energy security, digital infrastructure, and supply chain transitions.

Founded in 2006, New York-based GIP is the world’s largest independent infrastructure manager with over $100 billion in assets under management across infrastructure equity and credit strategies, targeting investments in the energy, transportation, digital, and water and waste sectors. The company’s investments include major renewables platforms Clearway, Vena, Atlas and Eolian, in addition to the Gatwick, Edinburgh, and Sydney airports, data center developers CyrusOne, waste and water circular solutions provider Suez, and rail and port operators.

The deal follows BlackRock’s characterization of infrastructure as a major source of investment opportunity in its recent 2024 Private Markets Outlook, released in December, driven by the low-carbon transition as a key mega-theme, and highlighting an upcoming “massive reallocation of capital” to rewire energy systems around the world. GIP has described decarbonization as central to its investment thesis.

In its press release announcing the acquisition, BlackRock said that the deal comes as “infrastructure is forecast to be one of the fastest growing segments of private markets in the years ahead,” with key drivers including increasing global demand for upgraded digital infrastructure, supply chain rewiring leading to renewed investment in logistical hubs such as airports, railroads and shipping ports, and decarbonization and energy security trends around the world.

BlackRock also noted the opportunities for infrastructure-focused private investors from participate in public-private partnerships in an environment of large government deficits, in addition to a conducive environment driven by high interest rates, with companies looking to improve return on capital through partnership opportunities for their embedded infrastructure assets.

BlackRock Chairman and CEO Larry Fink said:

“Infrastructure is one of the most exciting long-term investment opportunities, as a number of structural shifts re-shape the global economy. We believe the expansion of both physical and digital infrastructure will continue to accelerate, as governments prioritize self-sufficiency and security through increased domestic industrial capacity, energy independence, and onshoring or near-shoring of critical sectors. Policymakers are only just beginning to implement once-in-a-generation financial incentives for new infrastructure technologies and projects.”

Post-acquisition the combined company will boast a greater than $150 billion global infrastructure platform, led by the GIP management team. GIP founding partner, Chairman and CEO Bayo Ogunlesi will also join the board of BlackRock, following the close of the transaction, the companies said.

Ogunlesi said:

“Investors have adopted private infrastructure investing for its ability to provide stable cashflows, less correlated returns, and a hedge against inflation. Global corporates have turned to private infrastructure as a fast innovator and a more commercially agile owner of infrastructure assets that aren’t core to their commercial businesses. This platform is set to be the preeminent, one-stop infrastructure solutions provider for global corporates and the public sector, mobilizing long-term private capital through long-standing firm relationships.”

BNP Paribas Asset Management (BNPP AM) announced today the release of its new Global Sustainability Strategy (GSS), updating its approach to applying sustainability considerations in its investments, and including goals to grow its ranges of sustainable and impact investment solutions across themes including climate, nature-based solutions and economic equality.

The new sustainability strategy follows the launch in 2019 of BNPP AM’s first GSS, focused on the integration of ESG factors into its investment processes and boosting its engagement and stewardship approach on ESG issues.

Highlighting the progress made in its sustainability strategy, BNPP AM noted that the integration of ESG considerations into its product offerings has led to more than 90% of its European-domiciled open-ended funds’ AUM to be classified as Article 8 or Article 9 under the EU’s SFDR regulation.

In a post announcing the new GSS, Jane Ambachtsheer, Global Head of Sustainability at BNPP AM, said:

“Since our first GSS in 2019, Covid-19, humanitarian, geopolitical and energy crises, and climate disasters have reshaped economies. Regulations including the Sustainable Finance Disclosure Regulation have shaped sustainability-related investing.

“Despite these transformational events, we found that the fundamentals of our approach have remained sound.”

The GSS includes a focus on achieving three key themes, or “3Es,” including Energy transition, healthy Ecosystems, and greater Equality. Key areas of focus detailed in the strategy under these themes include substantially increasing climate and environmentally themed investments, strengthening the firm’s range of nature-based solutions and establishing a new forestry fund, and developing new investment strategies linked to equality and social themes.

The thematic focus forms part of BNPP AM’s GSS’ “six pillars” approach, which also encompasses responsible business conduct expectations for investee companies, applying ESG integration principles and developing proprietary sustainability research, stewardship and engagement, integrating sustainability across the product range, and adding its own internal Corporate Social Responsibility (CSR) strategy to its sustainability approach.

The strategy also includes a series of internal priorities for the firm, including investing in its ESG data programme and supporting the development of its range of ESG research methodologies, providing educational opportunities to employees and clients, and sharpening communication and knowledge sharing, including avoiding the risk of greenwashing.

Ambachtsheer said:

“Over the coming years, we believe the asset management industry will face far-reaching change, driven by a wider need to reallocate capital to a more sustainable and inclusive economy, taking into account geopolitical dynamics, evolving regulation, technological transformation and changing demographics.

“This impending and interconnected transition will require long-term investors to not only reposition their portfolios for sustainable growth, but to become a source of funding for the needed transformation.”

Click here to access BNPP AM’s new Global Sustainability Strategy.

Netherlands-based bank ABN AMRO announced today the appointment of Tanja Kramer as Head of the ABN AMRO Sustainable Impact Fund, with responsibilities including leadership of the fund as well as involvement in origination and execution activities.

Launched in 2021, the ABN AMRO Sustainable Impact Fund (SIF) makes direct investments in companies and early stage projects in key transition sectors, targeting key sustainability themes of circular economy, energy transition, and social impact. The fund has a commitment of €500 million, funded and managed by ABN AMRO.

Kramer joins the ABN AMRO SIF from Dutch venture capital investor Slingshot Ventures, where she served as a Partner, responsible for heading the investment team. Prior to joining Slingshot, Kramer held a series of senior finance roles, including serving as Head of Mergers and Acquisitions at KPN, and Director of Corporate Finance M&A at Royal Bank of Scotland, as well as serving at ABN AMRO as Assistant Director M&A.

In a social media post announcing the appointment, Kramer said:

“I am really excited to have joined the ABN AMRO Sustainable Impact Fund as of the beginning of this year! I am looking forward to working together with a great team and investing together in companies that have a positive impact on climate and society.”

Index provider S&P Dow Jones Indices (S&P DJI) announced today the launch of the S&P 500 SDG Index and the S&P Global LargeMidCap SDG Index, aimed at offering investors broad-based equity performance measurements and exposure to companies more aligned with the UN Sustainable Development Goals (SDGs).

The UN SDGs refer to the 17 categories of goals adopted in 2015 as part of the 2030 Agenda for Sustainable Development, with the aim to protect the planet and improve the quality of life globally.  SDG targets include ending poverty and hunger, improving education, and protecting the environment.

The new S&P 500 SDG and the S&P Global LargeMidCap SDG indices aim to measure the performance of eligible equity securities from S&P DJI’s flagship S&P 500 and S&P Global Large MidCap indices, respectively, with securities selected and weighted to enhance alignment to the SDGs, as well as to reduce carbon footprint at the index level.

From a performance benchmarking perspective, the indices leverage data to measure and reflect specific external impact that companies’ products and activities are making on society and the environment, regardless of the financial materiality implications. S&P DJI said that it licensed Corporate SDG alignment data from ESG impact data and portfolio solutions provider Impact Cubed, which uses a granular revenue and operations mapping approach, focused on a company’s products, and on how those products are made, as well as where the goods and services are sold and engagement with communities and stakeholders to determine company SDG alignment and net impact.

Jas Duhra, Global Head of Sustainability Indices at S&P DJI, said:

“With this approach, S&P DJI is offering broad-based sustainability performance measurement tools, one that is based on the S&P 500, which is the best single gauge of large-cap U.S. equities, and the other based on the S&P Global Large MidCap Index, which represents the top 85% market capitalization of each developed and emerging country.”

International asset manager Robeco announced the introduction of ocean sustainability and phasing out hazardous chemicals as two new focus themes that it will be discussing with companies in its 2024 engagements, in addition to stepping up pressure on high carbon companies to align with climate goals, and engaging with fashion companies to address key sustainability issues in the sector.

According to Robeco, each of its engagement topics were selected following consultation with clients. The asset manager’s sustainable investment engagements typically run for three-year periods, with engagement specialists in contact with selected investee companies to track progress against objectives.

Peter van der Werf, Head of Engagement at Robeco, said:

“We listened to our clients, and that’s why we’ve changed our approach.”

Robeco’s new ocean biodiversity theme will target approximately six companies assessed as having a significant impact on sea life, such as aquaculture and fisheries, focusing on issues including maritime pollution and overfishing. The company will also engage on the impact of deep sea mining, largely through its involvement in biodiversity-focused investor engagement group Nature Action 100.

The hazardous chemicals theme will also target around six companies, with a particular focus on phasing out PFAS. Widely known as “forever chemicals,” PFAS are a group of chemicals that have been in use in a wide range of consumer and industrial products since the 1940s, and are commonly found in food packaging, fabrics, kitchenware products, fire-fighting foam, and electronics, among other products. The chemicals tend to be very persistent, and don’t break down over time, and have been found to accumulate in the human body and in the environment.

Sylvia van Waveren, Robeco’s Senior Engagement Specialist responsible for dialogue with the chemicals industry, said:

“Both ocean biodiversity and hazardous chemicals have a focus on the planetary boundaries, which are way out of the safe zone.”

Under its ongoing “acceleration to Paris” theme, initially launched in late 2021, Robeco said that it will place a greater emphasis on speeding up the transition of business models to meet the Paris Agreement temperature goals, targeting high-carbon companies lagging behind in the net-zero transition. Robeco said that it will set minimum standards for 42 companies, with 2026 and 2028 deadlines for developed world and emerging markets companies, respectively, with potential exclusions to be put in place if the standards are not met.

Cristina Cedillo, Senior Engagement Specialist responsible for coordinating climate engagement at Robeco said that the minimum standards for the climate theme include “reporting emissions data for Scope 1 and Scope 2 and subsequently setting targets for emissions reductions.”

Cedillo added:

“In addition, we expect oil and gas companies to set methane targets, which is something that we don’t have yet. Finally, we also need companies to commit to no new coal expansion. All these criteria are part of our enhanced engagement program, which means that a company could be excluded if we were to conclude our engagement as non-effective.”

The sustainable fashion theme follows the recent launch by Robeco of the Fashion Engagement Equities Strategy, aimed at enabling investors to meet the dual objectives of earning attractive investment returns while promoting sustainability-focused change in the fashion industry. The fund aims to invest in 30 to 40 publicly listed companies across the entire fashion value chain, with a view to engaging with each portfolio company on improving sustainability, across key areas including decent work, natural resource stewardship, circular models, stakeholder management, and governance & policies.

van der Werf added:

“We used to do a deep dive on a peer group of companies, put them into an engagement theme, and then end the themes at the same time. Now we’re really planning to add companies on a rolling basis when our investment and sustainability research indicates the need for engagement.

“So, we’ll continue with what we call our ‘evergreen’ engagement themes of climate, biodiversity, human rights and governances. “It’s all an ongoing process, but with a focus on engaging where the most urgent issues will arise for companies in our strategies next year.”