…in ESG ratings, anyway Dream White Paper - Impact Delta co-authored a whitepaper with Dream, a leading Canadian real estate investor, regarding its recently launched impact funds. We had the privilege of assisting Dream in its effort to establish and maintain a ground-breaking Impact Management System. This paper provides context on Dream and an overview of the impact management approach. The approach has been well received by equity analysts - “Its impact status should broaden the Trust's appeal beyond the typical contingent of REIT investors. We believe the Trust will have a moat as it is difficult to replicate its "impact status“ – TD Securities (Initiated coverage Apr. ’21) Quality over Quantity of ESG data: A recently released report from Harvard Business

This paper is the product of a collaboration between Dream and Impact Delta. Dream is one of Canada’s leading real estate companies, with over $10 billion in assets across North America and Europe. Dream’s purpose is to deliver strong returns while delivering positive impact in the communities where it works. We advised Dream on the launch of its impact investing strategy, which is outlined in this white paper.

208 companies face exclusion from the FTSE4Good. It ain't easy being Green - Stock index provider FTSE Russell threatened to expel 208 companies from its FTSE4Good index this week, for failing to meet tightening climate reporting requirements. If it happens, the companies would see their shares sold off by many global pensions that use the index. These types of penalties are the only way regulators and exchanges can work to bust greenwashing. Good to see them being used. . . . DEI is gaining importance and pushing the middle market to change - Recent analysis by Pinebridge Investments has shed light on the lagging performance of most middle market PE managers around diversity, equity and inclusion. Less than half of managers track

…and another record for ESG flows. Irresistible Force or Immovable Object? Later today (May 26th), Exxon Corporation will hold its annual shareholders’ meeting. Although proxy fights over carbon disclosure and climate change are not new, a hedge fund has launched a campaign to elect four directors not recommended by the board’s governance committee. The accusation: Exxon is underperforming due to an inability to shift to new forms of energy. This may be the year that Exxon finally loses the battle with activist shareholders, as the three largest pension funds (CalPERS, CalSTRS and New York State Common Retirement Fund) have all stated they will support the board members submitted by proxy. Equity can also be green - Beyond punishing bad performers, investors increasingly

(Almost) everyone wants more disclosure.  Hello from Impact Delta. It's Earth Day tomorrow. Periodically, we share updates and content that we produce, as well as select other news that caught our eye. In this issue: Disclosure. More please. In March, the European Union enacted the first phase of its Sustainable Finance Disclosure Requirement (SFDR). These regulations are designed to provide consistency and transparency around sustainability claims (i.e., fight greenwashing), and also consideration of adverse impacts of investments. Also in March, the International Financial Reporting Standards Foundation (IFRS) announced a working group to accelerate convergence in global sustainability reporting. The Maple 8 agree... Last November, Canada’s eight largest pension plans (CAD1.6 trillion AUM) jointly announced that they are seeking better corporate disclosure of sustainability data.

Hello from Impact Delta. Global GDP down 25%? The G30 Working Group on Climate Change and Finance, co-chaired by Janet Yellen and Mark Carney, published a report last Thursday. In it, the G30 suggests global GDP might fall by a quarter by 2100 if steps are not taken to speed the transition away from fossil fuels. A carbon tax – the report suggests starting at $40 per ton – might help. Getting Paid for Good Behavior – While not all investing is impact investing, all investing has impact. A growing number of mainstream firms are exploring how to understand and manage their social and environmental footprint more systematically. Published today, our white paper Getting Paid for Good Behavior explains. ESG and PE –

Investors must understand the full impact of their decisions. Several tools exist to help them We published a white paper today, which explores the increasing importance of externalities in investment decision-making. Amid the upheavals of 2020, a growing number of investors are convinced they must understand the full impact – financial, environmental, and social – of their decisions. While externalities are inherently hard to measure, more progress on this question has been made than many mainstream investors realize. These are the main ideas, and the PDF is available for download at the button below. 1) Externalities – or the social and environmental impact of business activity – have never been more important. Evidence mounts that paying attention to impact is associated with superior performance

What if atmospheric carbon doubled? Hello from Impact Delta.  Periodically, we share updates and content that we produce, as well as select other news that caught our eye. In this issue: How Hot? A better answer to the question: How hot is the Earth going to get, if atmospheric carbon dioxide doubles from pre-industrial levels? For 40 years, scientists could only estimate a range of 1.5-4.5 °C. The conclusion of a huge study, published last week, is the range is more like 2.6-3.9 °C. Rethinking ESG in Private Equity – a recently published white paper Charles de Segundo co-authored with Paula Luff. In the post-pandemic world, firms may be tempted to take their old ESG approach and do it more intensely. We argue a

Asset owners’ decisions affect people over the world, so they want to know if investment managers’ ESG efforts are serious. Here are eight things to check. ESG flows and marketing ramp up Over the past few years, there has been steady growth in the number of firms and funds that seek to integrate ESG into their investment strategies.  According to the UNPRI’s 2019 Annual Report, the organization saw a 20% year-on-year growth in its signatory base; in North America, 456 new signatories joined UN PRI in 2018, and 628 did in 2019.  Morningstar’s first Global Sustainable Fund Flows Report, published in May 2020, demonstrates continued appetite for ESG funds in the wake of the COVID selloff. In Q1, sustainable funds globally saw $45.7bn in

A new era for ESG We published a white paper today, which explores how PE firms could change their mindset about ESG for the coming decade. These are the main ideas, and the PDF is available for download at the button below. The recent change in attitudes to environmental questions has been swift, and continues to gather force. The current health and social crises will accelerate changes in attitudes towards other, non-environmental dimensions of ESG factors, such as paid sick leave policies, the provision of healthcare and childcare, and other employee benefits that drive workforce engagement. Diversity and inclusion have gained new urgency. The growing financial materiality of these questions has made asset owners increasingly vocal, and GPs are now trying to catch up. GPs may

In 2020, renewables will at last account for a bigger share of U.S. electricity generation than coal, thanks to the coronavirus crisis. The last coal station in New York The last coal-fired power station in New York state was in the town of Somerset, near Lake Ontario, and about 40 miles north of Buffalo. Known as the Kintigh Generating Station, it was named after Allen Kintigh, the former boss of New York State Electric and Gas (NYSEG). When it opened in 1984, it was one of the cleanest coal-burning power stations in the country, thanks to then state-of-the-art emissions technology. The plant closed in March 2020, and over the last couple of years had only been delivering about 0.5% (0.69 MWh) of

Adding 10% to your monthly electricity bill could cut your footprint by 95%, in the one-sentence version. This post follows an introductory piece for people interesting in reducing their personal carbon footprint. In the series, we review the five categories most research uses, namely 1) residential energy use, 2) travel, 3) food, 4) goods, and 5) services. This is the first in the series – in “key points” format. We’ve also written a longer piece that walks through the mechanics. 13 big black balloons How much energy does the average American home use? It’s roughly 28,000 kWh per year. Given that only 11% of the national energy mix comes from renewables, each kWh of energy produces almost exactly 1 pound, or 0.4483 kg