As an aspirational goal, the project envisions that 1% (USD $10 billion) of WBCSD member companies’ total retirement assets (estimated at USD $1 trillion) will be invested in ESG-themed funds by 2020.
“This project marks an exciting step forward in transforming the financial system to reward the most sustainable companies,” said Peter Bakker, President and CEO of WBCSD. “The companies and market participants involved are leading the way, helping their employees invest their pension savings towards the world they want.”
Top asset management and investment consulting firms - including Allianz Global Investors, BlackRock, Legal & General Investment Management, Mercer and Natixis Investment Managers – have joined the initiative’s steering committee to contribute best practices and innovative thinking on ESG, helping to educate member companies on incorporating sustainable strategies in their retirement plans.
Through advancements in sustainable investing, initial data indicates it may be possible to create total portfolio solutions that enhance risk-adjusted returns in the long run without compromising short term return goals. This long-term outlook matches well with the long duration of retirement investments. Additionally, companies who have high ESG characteristics may also be more resilient through a downturn.
Moreover, a clear majority of all employees who work at Fortune 1000 companies expect their 401(k) plans to offer funds aligned with their own companies’ sustainability commitments, with this expectation rising to 66% with millennials and 67% among women, according to a soon-to-be-released study by Povaddo. Such interest has the potential to increase participant engagement and savings rates.
“WBCSD’s ARA project will help provide a variety of stakeholders inside companies with the tools they need to support adoption of ESG investing in company retirement plans with the end goal of improving participant outcomes," said Alex Bernhardt, U.S. Head of Responsible Investment for Mercer.
Ed Farrington, Natixis’ Executive Vice President for Retirement Strategies said, “Our research has shown that plan participants would save more in their retirement accounts if their investments had a positive social or environmental effect. We hope that constructing a plan offering that aligns retirement savers’ investments with their personal values will help encourage engagement and will ultimately have an enormously positive impact on the US retirement savings system that’s in place today. We are excited to join WBCSD in this effort.”
“With low interest rates and increased longevity, companies need to motivate more people to participate in pension plans and 401(k)s to keep the system healthy,” said Irshaad Ahmad, Head of Institutional Europe at Allianz Global Investors. “Sustainability helps build the context to influence the behavior of plan participants, especially with Millennials who are keenly focused on values.”
“At BlackRock, we believe a company’s approach to managing material environmental, social, and governance issues is a key component of long-term growth,” stated Anne Ackerley, BlackRock’s Head of U.S. and Canada Defined Contribution Group. “We are pleased to join this effort to help educate companies on incorporating sustainable strategies in their retirement plans.”
Caroline Ramscar, Head of Sustainability Solutions at Legal & General Investment Management said, “Collaborations are important for our industry to share knowledge, encourage best practices and to push the agenda on the issues that matter most to our clients. We believe that sustainable investing should be mainstream within the industry and are continually looking at new and innovative ways to engage and deliver these messages. There is no better way to create large scale change than to work with our peers and organizations such as WBCSD to pool resources - we are delighted to come on board.”
About the World Business Council for Sustainable Development (WBCSD)
WBCSD is a global, CEO-led organization of over 200 leading businesses working together to accelerate the transition to a sustainable world. We help make our member companies more successful and sustainable by focusing on the maximum positive impact for shareholders, the environment and societies.
Our member companies come from all business sectors and all major economies, representing a combined revenue of more than $8.5 trillion and 19 million employees. Our global network of almost 70 national business councils gives our members unparalleled reach across the globe. WBCSD is uniquely positioned to work with member companies along and across value chains to deliver impactful business solutions to the most challenging sustainability issues.
Together, we are the leading voice of business for sustainability: united by our vision of a world where more than 9 billion people are all living well and within the boundaries of our planet, by 2050. http://www.wbcsd.org
About Allianz Global Investors:
Allianz Global Investors is a leading active asset manager with over 700 investment professionals* in 25 offices worldwide and managing more than EUR 500 billion in assets for individuals, families and institutions.
Active is the most important word in our vocabulary. Active is how we create and share value with clients. We believe in solving, not selling, and in adding value beyond pure economic gain. We invest for the long term, employing our innovative investment expertise and global resources. Our goal is to ensure a superior experience for our clients, wherever they are based and whatever their investment needs.
Active is: Allianz Global Investors
Data as at 31 March 2018 (*as at 31 December 2017).
BlackRock helps investors build better financial futures. As a fiduciary to our clients, we provide the investment and technology solutions they need when planning for their most important goals. As of March 31, 2018, the firm managed approximately $6.317 trillion in assets on behalf of investors worldwide. For additional information on BlackRock, please visit www.blackrock.com.
About Legal & General Investment Management:
Legal & General Investment Management is one of Europe’s largest asset managers and a major global investor, with total assets of £983.3 billion1. We work with a wide range of global clients, including pension schemes, sovereign wealth funds, fund distributors and retail investors.
Throughout the past 40 years we have built our business through understanding what matters most to our clients and transforming this insight into valuable, accessible investment products and solutions. We provide investment expertise across the full spectrum of asset classes including fixed income, equities, commercial property and cash. Our capabilities range from index-tracking and active strategies to liquidity management and liability-based risk management solutions.
Mercer delivers advice and technology-driven solutions that help organizations meet the health, wealth and career needs of a changing workforce. Mercer’s more than 23,000 employees are based in 44 countries and the firm operates in over 130 countries. Mercer is a wholly owned subsidiary of Marsh & McLennan Companies (NYSE: MMC), the leading global professional services firm in the areas of risk, strategy and people. With nearly 65,000 colleagues and annual revenue over $14 billion, through its market-leading companies including Marsh, Guy Carpenter and Oliver Wyman, Marsh & McLennan helps clients navigate an increasingly dynamic and complex environment. For more information, visit www.mercer.com. Follow Mercer on Twitter @Mercer.
About Natixis Investment Managers
Natixis Investment Managers serves financial professionals with more insightful ways to construct portfolios. Powered by the expertise of 26 specialized investment managers globally, we apply Active ThinkingSM to deliver proactive solutions that help clients pursue better outcomes in all markets. Natixis ranks among the world’s largest asset management firms2 with more than $1 trillion assets under management3 (€818.1 billion AUM).
Headquartered in Paris and Boston, Natixis Investment Managers is a subsidiary of Natixis. Listed on the Paris Stock Exchange, Natixis is a subsidiary of BPCE, the second-largest banking group in France. Natixis Investment Managers’ affiliated investment management firms and distribution and service groups include Active Index Advisors®;4 AEW; AlphaSimplex Group; Axeltis; Darius Capital Partners; DNCA Investments;5 Dorval Asset Management;6 Gateway Investment Advisers; H2O Asset Management;6 Harris Associates; Investors Mutual Limited; Loomis, Sayles & Company; Managed Portfolio Advisors®;4 McDonnell Investment Management; Mirova;7 Ossiam; Ostrum Asset Management; Seeyond;7 Vaughan Nelson Investment Management; Vega Investment Managers; and Natixis Private Equity Division, which includes Seventure Partners, Naxicap Partners, Alliance Entreprendre, Euro Private Equity, Caspian Private Equity;8 and Eagle Asia Partners. Not all offerings available in all jurisdictions. For additional information, please visit the company’s website at im.natixis.com | LinkedIn: linkedin.com/company/natixis-investment-managers.
Natixis Investment Managers includes all of the investment management and distribution entities affiliated with Natixis Distribution, L.P. and Natixis Investment Managers S.A.
2 Cerulli Quantitative Update: Global Markets 2017 ranked Natixis Investment Managers (formerly Natixis Global Asset Management) as the 15th largest asset manager in the world based on assets under management as of December 31, 2016.
3 Net asset value as of March 31, 2018 is $1.008 trillion. Assets under management (“AUM”), as reported, may include notional assets, assets serviced, gross assets and other types of non-regulatory AUM.
4 A division of Natixis Advisors, L.P.
5 A brand of DNCA Finance.
6 A subsidiary of Ostrum Asset Management.
7 Operated in the US through Ostrum Asset Management U.S., LLC.
8 Caspian Private Equity is a joint venture between Natixis Investment Managers, L.P. and Caspian Management Holdings, LLC.
The views and opinions expressed may change based on market and other conditions.
Sustainable investing focuses on investments in companies that relate to certain sustainable development themes and demonstrate adherence to environmental, social and governance (ESG) practices, therefore the Fund’s universe of investments may be reduced. It may sell a security when it could be disadvantageous to do so or forgo opportunities in certain companies, industries, sectors or countries. This could have a negative impact on performance depending on whether such investments are in or out of favor.
Natixis Distribution, L.P. is a limited purpose broker-dealer and the distributor of various registered investment companies for which advisory services are provided by affiliates of Natixis Investment Managers, S.A.
Natixis Distribution, L.P. • 800-225-5478 • im.natixis.com
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