Investors are being called upon to take action in addressing the social and economic impacts of COVID-19, escalating wealth inequality, systemic racism and the continuing climate crisis.
Last week, the SHARE Investor Summit 2021 brought together more than 50 speakers and nearly 350 institutional investors with the goal of shifting capital markets towards inclusion, justice, equity, sustainability and resilience.
Here are just a few of the highlights from the four days of sessions focused on using our collective voices as investors to rise to these challenges in the coming year and beyond.
Mobilizing for a Green COVID-19 Recovery
The Summit keynote address was presented by Demond Drummer, Executive Director of New Consensus and one of the architects of the Green New Deal in the US.
Drummer argued that a green COVID-19 recovery must be sustainable, which means being fully inclusive of environmental, economic, political, and social change. His presentation focused on how the needed mobilization is massive, but not unprecedented. In the 1930s, the United States Government’s New Deal called upon both the public and private sector to pull its citizens out of the Great Depression, and later coordinated the large-scale effort to prepare the country for the Second World War.
Drummer said that like these earlier mobilizations, a Green COVID-19 recovery requires more than business as usual – it will take a paradigm shift in our economies and societies.
- COVID-19 has highlighted weaknesses and inequality in society. We must look at the assumptions that lead to these weaknesses as part of the recovery.
- “Green” must consider that pollution and environmental degradation affects poor and racialized communities disproportionately.
- The recovery will take three substantial shifts in thinking about money and markets: from currency to the economy, from profitable investments to productive investments, and from government as only taxer and regulator to government as investor and shaper of markets.
Affordable Cities: How can investors address the affordable housing crisis?
This session looked at the financialization of housing as a driver of poverty and inequality in Canada. It explored the ways in which investors can prioritize affordability in their residential real estate investments and the different models that can enable that.
- There is a role for institutional investors to support alternative mechanisms for housing such as community land trusts, and to engage in multi-party lending schemes, which help further social goals and generate a positive social impact.
- New Market Funds and Wespath Benefits and Investments demonstrate that a sophisticated approach to affordable housing investment can achieve market returns. Properly structured and in the right market segments, these deals work for pension funds and other fiduciaries.
- Parkdale Community Wealth Building Report
- The financialization of Canadian multi-family rental housing: From trailer to tower
- Case Study: Vancouver Community Land Trust Foundation
- Homewreckers, by Aaron Glantz
- Podcast Reveal
- PUSH Documentary
Practical Realities of Responsible Investment Oversight: Strategies for evaluating asset managers’ ESG performance
This session provided practical advice to asset owners on the kind of information to look for when hiring new managers and in monitoring new managers regarding their ESG performance.
Colin Baines, the Investment Engagement Manager at Friends Provident Foundation, introduced the ESG Investing Olympics – a public, joint tender to the investment industry with the simple instruction to “impress us on social and environmental integration and impact.”
Chief Responsible Investment Officer at Brunel Pension Partnership, Faith Ward, provided an overview of efforts to embed ESG across their portfolio and outlined what they have learned in hiring external managers to manage assets worth approximately $53 billion CAD.
Tamara Herman, Program Manager of Capital Strategies at SHARE and the Committee on Workers Capital (CWC) spoke about the CWC’s Asset Manager Accountability Initiative, which provides support to trustees and unions in holding asset managers accountable at the company level, in the investment chain and the financial system. This initiative emerged from the discrepancies between asset managers’ commitments and actions.
- Proxy voting records can be a great resource for understanding your manager’s approach to ESG in their stewardship practices. SHARE’s proxy voting audit tool can help asset owners better understand this.
- Can your portfolio manager answer questions about ESG thoughtfully or do they defer to specialized staff? While specialized ESG staff are valuable and important, you want your If your portfolio manager to be able to field all questions related to ESG if these factors are truly integrated.
- Brunel’s Asset Manager Accord is a tool that helps define the kind of relationship they are seeking with their asset managers.
- The Committee on Workers’ Capital report on BlackRock and its approach to workers’ rights in its stewardship practices
- The Transition Pathway Initiative is a free resource to help investors assess companies’ preparedness for the transition to a low-carbon economy
- ESG investing Olympics state of the sector report
Launch of the University Network for Investor Engagement
At the SHARE Investor Summit, a coalition of Canadian universities launched a new initiative to engage investee corporations on climate change risks.
On behalf of University Network for Investor Engagement (UNIE), SHARE will engage with North American public companies held in university endowment and pension portfolios to address pervasive risks associated with climate change. The UNIE initiative will focus on key sectors where advocacy can make the biggest difference, including finance, transportation, energy and utilities, and manufacturing.
Initial participants include Carleton University, Concordia University, McGill University, McMaster University, Mount Allison University, Université de Montreal, University of St. Michael’s College, University of Toronto Asset Management, University of Victoria, and York University.
“These universities are showing leadership in addressing the climate crisis. Working together in one program amplifies each institution’s voice and leverages their power to bring about change,” said Kevin Thomas, Chief Executive Officer at SHARE.