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SSF Newsletter December 2015: Paris & Beyond
 
 

The COP 21 conference in Paris has had a strong influence on climate discussions in the finance industry before it even started.

 

Over the past months countless events took place on carbon risks in portfolios and many institutional investors around the world announced action to reduce these risks.

 

For Swiss Sustainable Finance, climate risks were also high on the agenda. In the course of two practical workshops featuring European investors with strong track records in measuring portfolio carbon risks, attendants discussed current methods and trends with research providers and institutional asset owners.

 

It is clear that the climate topic is here to stay – yet there are many other aspects that deserve investors' attention.  The recent SSF workshop held at the TBLI conference in Zurich gave a good flavour of Swiss investments for development contributing to achieving the ambitious Sustainable Development Goals of the United Nations while offering investors interesting opportunities. SSF is committed to supporting an ongoing dialogue on how material sustainability issues are best identified and turned into opportunities in the investment context.

 

Kind regards

 

Sabine Döbeli

CEO Swiss Sustainable Finance

 
 
 
Content
 

SSF activities

Regulatory and Market News

SSF and sustainable finance in the media

Save these dates

New studies & reports

Varia from our network

Closing thoughts

 
 
 
SSF activities
 

Read short summaries of our activities here and gain more insights on our website.

 

TBLI Europe, 20 November 2015, Rüschlikon

 

As part of the TBLI Conference Europe 2015, SSF CEO, Sabine Döbeli moderated a workshop with three prominent representatives in the area of "Investments for Development: Swiss Innovation For A Sustainable World." With the adoption of the Sustainable Development Goals (SDG) now in place, the panelists (Patrick Elmer, Head Business Development at BlueOrchard, Christian Etzensperger, Head Corporate Development & Strategy from responsAbility and Andrea Heinzer, CIO & Partner at Obviam, the manager of SIFEM) were asked to explain how their organisations partnered with the public sector to make such topics investable.

 

Read more

 
 
 

Investor Workshops on Carbon Foot Printing, 5/6 November 2015, Zürich and Geneva

 

SSF teamed up with the Institutional Investors Group on Climate Change (IIGCC) to hold an in-depth discussion on how to measure the carbon footprint of a portfolio. In two separate events which took place in Zürich and Geneva, representatives of the Swedish AP 2 Fund, French ERAFP, Swiss Publica and Nest, as well as experts from four service providers, offered insights into practical experiences and discussed them openly with 150 professionals.

 

In light of a recently published report published by the Swiss Federal Office for the Environment (FOEN) on the risks of holding carbon intensive assets in Swiss fund and pension fund portfolios, the SSF  events came at the perfect time. “Carbon Compass”, a recent report published by Kepler Chevreux in cooperation with IIGCC and others, provides further insights into the topic and is an interesting read for all who visited our event – and for others too.

 

Read more

 
 
 

Der neue Swiss Governance Code - Impulse für eine professionelle Vermögensbewirtschaftung von Stiftungen, 27 October 2015, Zürich

 

In September, SwissFoundations, the association of Swiss grant-making foundations, published a completely revised edition of the new Swiss Governance Code. Forum Nachhaltige Geldanlagen (FNG), SwissFoundations and Swiss Sustainable Finance jointly held an event to present the most important amendments to the code and to discuss the effects the code will have on the asset management of foundations.

 

Read more

 

SSF was also present at many other events. Read more

 

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Regulatory and Market News
 

4 November 2015: World Federation of Exchanges (WFE) New Sustainability Guidance

 

The WFE, representing 64 public stock, futures and options exchanges where over 44,000 companies are listed, has presented recommendations to its member exchanges on how to implement sustainability policies. The WFE Guidance & Recommendations identifies material ESG metrics which exchanges can use to guide disclosure requirements for listed companies.

 

2 November 2015:  International Corporate Governance Network (ICGN) developing Global stewardship code

 

The ICGN, with members representing institutional investors with over 26 trillion USD of assets under management, has launched a consultation amongst their members for a Global Stewardship Code. Following the introduction of the first stewardship code in the UK in 2010, this first global version would act as an international “passport” for institutional investors and will help set the standard as individual countries launch similar codes.

 

21 October 2015: European directive IORP proposed amendments include reference to 'stranded assets' for Pension Fund investment strategies

 

The European directive, the Institutions of Occupational Retirement Provision (IORP), which first appeared in 2003, is currently in revision at the European Parliament. Bas Eickhout, a Dutch MEP and member of the Greens put forth an amendment suggesting that stranded assets should not be part of a long-term strategy, and should include “effective mechanisms” for risk mitigation. It remains to be seen if this proposed amendment is accepted and integrated into the revised version of the IORP.

 
1 October: France implementing new government-backed SRI funds label starting Q1, 2016

 

The French government will support a new public SRI quality label for investment funds starting in early 2016. The label will be backed by Cofrac, France's state-funded, not-for-profit accreditation agency. The new SRI label will also be supported by AFG, the French asset management association. Yves Perrier, CEO at Amundi and President of AFG stated that the label would bring a "competitive advantage to the Paris financial market."

 

29 September: Marc Carney, Governor of the Bank of England, openly discussed huge climate risks for investors

 

In a speech to the insurance market Lloyd's of London, Carney adamantly stated his views on the potential "huge" losses that could occur should there be a sudden shift in regulations geared to prevent global warming and the use of fossil fuels. His statements make him the most prominent figure yet from the financial industry to look at how climate-related issues could destabilize financial markets due to 'stranded assets'. However, he does face criticism from the investment community.     

 

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Save these dates
 

BERN, 7 December 2015

Emerging Africa Infrastructure Fund (EAIF) Awareness Day - Doing Business with the EAIF

At the event EAIF Chairman David White, EAIF Executive Director Emilio Cattaneo and Anthony Marsh, CEO of EAIF’s fund manager Frontier Markets Fund Managers Ltd will present and take questions on the opportunities of working with EAIF.

 

Private Infrastructure Development Group CEO Philippe Valahu and representatives of the Swiss Government will also be present to field questions.

 

To register email: judy.millingen@mdy.co.uk

Geneva/Zurich, 7/8 December 2015

PRI Conference: Innovation, Technologies & Stewardship, Geneva / Zürich

The conferences will focus on how innovation and technology can assist in enhancing responsible asset management processes, both in terms of integrating ESG and delivering stewardship. Sessions will include: updates on recent advancements in research and technology; a debate on whether the homo economicus can actually deliver stewardship; ESG insights from financial data science; plus a debate on whether the Swiss pension fund market is at a tipping point. SSF will be represented on the panel in Zurich.

 

Registration for this event is now closed

 

Zurich, 19 January 2016

Social Entrepreneurship Initiative & Foundation (seif) - Impact Investment Congress

The seif Congress 2016 for Impact Investing and Social Innovation seeks to provide attendees with inspiring insights and models from the impact investing sector and gives the opportunity to learn from each other through exchanging ideas and experience.

 

Online Registration

 

Geneva/Zurich, 1-2 February 2016

AZEK-Campus: Longterm and Sustainable Finance

AZEK in cooperation with SSF is organizing two one-day seminars on long-term finance and the role of sustainability in asset management. More information to follow soon on AZEK and SSF websites.

 

Zürich,  9 March 2016

How new soft and hard law requirements challenge the financial sector

In this SSF event we will shed light on the rapidly evolving regulatory environment pertaining to corporate responsibility and sustainability. What are the risks and opportunities that financial institutions face due to new soft and hard law initiatives? How can banks, insurers, and asset managers make sure they are prepared for the changes ahead? More information to follow soon on SSF website.

 

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SSF and sustainable finance in the media
 

13 November 2015, Schweizer Radio und Fernsehen (SRF): Mikrokredite: Interview with Jean-Daniel Gerber

9 November 2015, die-stiftung.de: Ein Steilpass an die Finanzbranche – Diskussionsrunde zum neuen Swiss Foundation Code

6 November 2015, Radiotelevisione svizzera (RSI): Investimenti Sostenibili – Interview with Sabine Döbeli

30 October 2015, Radio Télévision Suisse (RTS): La place financière suisse face au risque carbone – Interview with Jean Laville

30 October 2015, NZZ: Geldforderungen stossen in der Schweiz auf Ablehnung

23 October 2015, SI Gruen: Mit gutem Gewissen gutes Geld verdienen – Interview with Sabine Döbeli

23 October 2015, SI Gruen: Gagner de l’argent avec consience – Interview with Jean Laville

23 October 2015, RSI: Television Program Tempi Moderni : Report on Sustainable Finance

25 September 2015, Corriere del Ticino: Finanza: Se l’etica fa la differenza

25 September 2015, RSI: Interview – Sabine Döbeli (SSF) and Stefano Montobbio (BSI Bank) on Sustainable Investing

 


 

Visit our website for regularly updated articles on SSF and sustainable finance

 

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New reports & studies
 

Kohlenstoffrisiken für den Finanzplatz Schweiz

South Pole Group and CSSP, commissioned by the Swiss Federal Office for the Environment (FOEN), October 2015

The study analyses indirect greenhouse gas emissions linked to the Swiss equity fund market and outlines risks and costs involved in equity investments in case stricter carbon pricing and regulations are put in place. The report also includes a closer look at 11 of the largest 25 pension funds in Switzerland and how future carbon pricing scenarios will affect beneficiaries.

 

The Financial System We Need: Aligning the Financial System with Sustainable Development. The UNEP Inquiry Report

UNEP, October 2015

The UNEP Inquiry into the Design of a Sustainable Financial System was established in January 2014. The Inquiry has looked in-depth at practice in over 15 countries - including Switzerland. Five types of measures for more sustainability in the financial system are presented: Enhancing market practice, harnessing the public balance sheet, directing finance through policy measures, transforming financial culture, upgrading system governance.

 

Fiduciary Duty in the 21st Century

UNEP FI and PRI, October 2015

This research, based on structured interviews with senior investment professionals, lawyers and policy makers, finds that failing to consider long-term investment value drivers, which include environmental, social and governance issues, in investment practice is a failure of fiduciary duty.

While many investors have made positive steps to incorporate sustainability risks into the way they deliver their fiduciary duty, the report argues that too many assets are still managed with a 20th century mindset, exposing savers and beneficiaries to the threat of value loss.

 

BOOK: Small Money, Big Impact. Mikrofinanz: Leben ohne Armut

October 2015

This book authored by Peter Fanconi and Patrick Scheurle from Blue Orchard, illustrates the power of microfinance with many practical examples and facts and figures. The authors explain how microfinance became a fast growing asset class for private investments. The book is available in German only.

 

Profile of Responsible Investors in Europe

Novethic, November 2015

Novethic has published its 8th survey on responsible investment practices among European asset owners in 13 countries. The results show that climate is a priority for 53% of the 181 institutions surveyed, together holding €7,367 billion in assets; very few, however, have decided to exclude fossil fuels from their investments so far. SSF played a role in the study through its efforts in collecting data for parts of the Swiss market.

 

 

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Varia from our network
 

Philipp Krueger, Assistant Professor of Responsible Finance at University of Geneva, wins prestigious Moskowitz Prize

 

The academic paper “Climate Change and Firm Valuation: Evidence from a Quasi-Natural Experiment estimates the effect of mandatory greenhouse gas (GHG) emissions disclosure on corporate value. Using the introduction of mandatory GHG emissions reporting for firms listed on the Main Market of the London Stock Exchange as a source of exogenous variation, the author finds that firms most heavily affected by the regulation experience significantly positive valuation effects. Increases in value are strongest for large firms and for firms from carbon intensive industries (e.g., oil and gas). Valuation increases are driven by capital market effects such as higher liquidity and lower bid-ask spreads for the most affected firms.

 

We congratulate Philipp for this international recognition of his work.

 

To highlight this and other news, SSF has created  a section with members’ news on its website. Check our member’s press releases for more information on sustainable finance in Switzerland.

 

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Closing thoughts
 

Our newsletter impressively illustrates the strong dynamics in sustainable finance – both in Switzerland and abroad. Looking back on a year of intense interaction both with our members and the public, we are positive that we’ll increasingly see the topic on the mainstream agenda in the months to come. In the meantime, we wish you a great close to the year and some quiet days over the holiday season to re-energize for 2016.


Best regards


The SSF team

 

View past SSF newsletters

 
 
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