17 June 2015
The 2015 SSF Members' Assembly brought together 80 members and network partners. At this year's assembly, SSF gained a new President, Jean-Daniel Gerber, and two new Board members, Caroline Anstey (UBS) and Béatrice Fischer (Credit Suisse).
The afternoon program consisted of presentations from the management team, as well as 6 breakout sessions on various themes. SSF closed the day with a keynote speech from Nicholas Niggli, Head of the Economic, Finance, Science & Innovation Section at the Swiss Embassy in London and President of the 'Association of Economic Representatives in London'. He used his speech - 'Wind of Change - A London Perspective on the Challenges & Opportunities for the Swiss Finance Center (with a focus on sustainable finance)' - to share his opinions on this topic and encourage the audience to trust in their flair for innovation and take advantage of chances that arise at the earliest opportunity.
Breakout Sessions in the afternoon brought together experts and fostered in-depth conversations on the following topics:
Switzerland as a centre for Asset Management - does ESG integration boost competitiveness?
In this session moderated by Angela de Wolff (Conser Invest SA), René Nicolodi (ZKB) and Pierin Menzli (Bank J. Safra Sarasin) spoke about ESG integration.
The key findings after the hour of discussions were:
1. ESG integration is well adopted by Asset Managers in Switzerland but generally approaches still remain unsophisticated and segregated from mainstream investment
2. ESG Integration can contribute to make successful Asset Managers by:
- supporting well-structured investment processes
- increasing transparency
- offering superior customer services (brand recognition)
3. Swiss Asset Managers should invest to develop the new generation of ESG integration (2.0) with the following features:
- a focus on ESG criteria with added value for investment (financial & non financial)
- performance driven
- impact measurement
- transparency & traceability
Trillions for development: the Swiss role in raising private capital
Lukas Schneller (SECO), Fabio Sofia (Symbiotics) and Frédéric Berney (BlueOrchard Finance SA) held a lively discussion on investments needed for development.
The discussion resulted in the following main conclusions:
- Expertise in investments for development products is high among Swiss players. However, the communication towards investors and information about the benefits and advantages of the industry are less evident. The Swiss industry is not yet well known and should focus efforts on communicating our strengths.
- The Public sector has so far been very active. There is however a gap of resources as funds are still needed for many potential projects. Clear objectives are required for investing while seperate considerations on Technical Assistance and ensuring a sound market infrastructure within the target countries remain key objectives.
- Measurement of impact is key for all players. Players are qualifying the measurement with different grading systems. While some measure specific outputs, others insist on a more detailed measurement of impact. There is a potential need for agreeing on a global standard rating.
Active ownership on the rise? The impact of the Minder initiative
Dominique Biedermann (Ethos Foundation) and Philipp Leu (Inrate Ltd) discussed their views on active ownership. Moderated by Dominique Habegger (de Pury Pictet Turrettini), the panel came to the conclusions that the Minder initiative has had limited success in achieving its goals so far and often loop-holes are used to get around the intended effects of the initiative. Although the transparency around remuneration models is increasing, there is still room for improvement. The panel felt we are moving in the right direction and were optimistic that further changes are on the rise. The panel left the audience with some important take-home points:
- Voting should be a must within sustainable finance and engagement an additional instrument for active ownership.
- Minder had a high impact on transparency, resulted in a tendency for more moderate salaries, but salaries still remained high in an international context.
- Lack of board independence and violation of “one share one vote” principles should not be ignored and overshadowed by remuneration issues.
Climate change: Implications on assets and liabilities
In the session, David Bresch, head of Sustainability and Political Risk at Swiss Re, and Eric Borremans, responsible for Sustainability at Pictet, discussed the implications of a warmer planet on both assets and liabilities. On the insurance side, David Bresch argued that reinsurance can play an important role in strengthening the resilience of communities around the world to natural disasters caused by climate change. David further noted that failing to adapt to climate change could pose a serious risk to the business model of insurance companies. On the assets side, Eric Borremons discussed how investors are measuring the carbon intensity of their investments, as well as the advantages and limitations of carbon footprinting of investment portfolios. The panel, which was moderated by Nicole Neghaiwi from the South Pole Group, included active feedback from the audience. The audience expressed concern that the Swiss financial industry is falling behind when it comes to integrating climate change considerations into their investment decisions and concluded that Swiss Sustainable Finance could be a welcome avenue for addressing this gap.
Swiss Energy Strategy 2050: resulting opportunities for the financial sector with a focus on real estate
The two expert panalists, Christian Bächinger (CCRS) and Andreas Wiencke (Credit Suisse AG), and audience, were led through discussions by moderator Katharina Serafimova (WWF Switzerland).
Some of the main findings of the discussions were:
- Real Estate accounts for a 30% of overall carbon emissions and 40% of energy consumption and could likely face a situation of having to reduce more emissions relative to other sectors, in addition to possibly having to realize these reductions earlier. The Swiss energy strategy, for example, requires the real estate sector to reduce its emission by 40% until 2020.
- Experiences confirm that there is a clear business-case for real estate investors to analyze their carbon exposure and take the necessary mitigation measures – in the interest of both the long-term performance and their contribution to low-carbon transition. However, it will be challenging for investors to realize a reduction needed to be 2-degree-compliant.
- In Switzerland, 88% of all buildings are privately owned. Therefore private home owners are relevant agents for the needed actions. While market rents are key drivers for investors, private home owners tend to respond to energy price and possible savings from energy efficiency as main drivers.
Sustainable investment solutions offering attractive alternatives in the current low interest environment
Ralph Kretschmer (EBG Investment Solutions) and Robert Müller (Forma Futura Invest AG) discussed their views with moderator Michael Diaz (Alternative Bank Schweiz). The panel clearly agreed that we should not look at Sustainable Investments as alternatives in low interest environments, but rather Sustainable Investments are ALWAYS the better solution.
Key conclusions from this session were:
- In the current low interest environment the challenge is to preserve clients wealth rather than to increase it
- It's not a question of SRI as Core or Satellite. It's one of SRI as Core AND Satellite
- There is more and more interest in Sustainable Alternative Investments, however investments in this field should be well planned