What is the State of Sustainable Investment in Africa?
with Graham Sinclair
This presentation will analyze the current state of sustainable institutional investment in Africa in 2012, and point to pressing research questions faced by practitioners. It will also describe a collaborative research project being conducted by AfricaSIF.org to map the marketplace in 2012.
Aggregating available information in 2011, the assets under management may be more than US$ 125 billion, making Africa a top 10 global marketplace for sustainable investment. Major emerging markets like South Africa, Morocco and Egypt, and frontier markets like Nigeria, Mauritius and Kenya represent new investable opportunities for global emerging markets investors, and African pension funds, banks and insurance companies looking for long term investments. South Africa has seen some major new developments, such as revised pensions regulation 28, voluntary initiatives such as CRISA, PRI and Carbon Disclosure Project, hosting COP17, carbon tax proposals and investment value chain projects, and the emergence of integrated reporting. The impact investing theme has attracted billions of assets from investors. But what is the impact on sustainable development? What has been learned by the Sustainable Returns project mapping the investment value chain in southern Africa, and the state of environmental, social and governance (ESG) integration?
In 2012, the inaugural AfricaSIF.org Marketplace Trends Report 2012 project will research, analyze and publish a report on the sustainable investment market size and dynamics in 54 countries in Africa. In parallel, for the first time, global SIFs are harmonizing their reporting approaches, so AfricaSIF.org will present an Africa report and contribute the Africa coverage into the global SIFs Trends Report in December 2012. The report will answer the question: how much sustainable investment is in Africa today, and what does it look like? The report is designed to offer a marketplace survey of the institutional investment industry in Africa focused on investments that in some way cover environmental, social and governance factors. The activities of portfolio investors, fund management industry, stock exchanges and other stakeholders will be covered, where relevant, to describe the marketplace. AfricaSIF.org Marketplace Trends Report 2012 project seeks to offer participants learnings on what is / is not being done in Africa, and the ongoing risks and opportunities in the context of economic development in Africa.
SinCo - http://www.sincosinco.com/sustainable-returns-project.php
AfricaSIF.org - http://www.africasif.org/marketplace-and-trends-report.php
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Agenda
3
CONTEXT
• Significant increase in interest around
sustainable investment, ESG factors, and the
role of asset management
• Studies in Africa centering on South Africa,
recently expanded to multi-country surveys
and analysis of North Africa and Sub-Saharan
Africa
• Academic literature focused mostly in South
Africa reviewing pensions and asset
management activity, role of JSE SRI index and
multi-stakeholder initiatives for example
Carbon Disclosure Project
DISCUSSION TODAY
1. Summary of selected recent research/activity
• Sustainable Investment in Middle East and
North Africa (2010) and Sub-Saharan Africa,
(2011)
• 2011-2012 – watershed year?
• OneYear Later Report
• Sustainable Returns Project – Phase 1 report
“Defining Momentum” on retirement fund
investment value chain paper
2. AfricaSIF.org Marketplace Trends Report 2012
3. Conclusions and next steps
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SinCo
sustainable investment consulting, global emerging markets practice
SinCo at a Glance
Bespoke investment advisory focused on
sustainable investment architecture
Architect + analysts with support team operating
projects with partners in Geneva, Seattle, London,
Nairobi,Washington DC, Cape Town, Istanbul
Word-of-mouth, below-the-radar approach
working directly with principal
Philosophy
SinCo is a boutique investment advisory firm
specializing as an ESG investment architect for
sustainable investment in frontier and emerging
markets.
SinCo helps clarify questions, design develop
answers, and project manages thinking into action.
SinCo promotes answers to sustainability
emerging from talent in frontier and emerging
markets, as well as developed countries.
Experienced
Established boutique in Boston in Q4 2006: inaugural
engagement for Wall St proprietary and third party
manager with USD 900bn AUM, 200 analysts, mutli-
asset classes
Since 2006, SinCo has delivered sustainable
investment architecture globally to pension funds,
asset managers and international organizations
integrating ESG factors into investment practice.
Projects for proprietary clients in listed equity, hedge
funds, investment product RD, investment bank
derivative instruments, ESG impact metrics.
Proven Project Leader
Multi-year, multi-stakeholder, multi-country projects
over milestones through time, including PRI in EM
project rollout.
ESG services
Bespoke research, benchmarking ESG best practices,
making sustainable investment case, designing ESG
indexes, streamlining private equity ESG frameworks,
investment roadshows
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As sustainable investment architect, we consider sustainability through the lens of environmental, social and governance
factors are integrated in all investment decisions.Working with SinCo our clients have access to world-class strategy, plans
and experience to quickly and effectively solve the challenges in making sustainable investment work.
sincosinco.com
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youtube.com/africasif
AfricaSIF.org is an independent, pan-African, not-for-
profit network, knowledgebase and advocate promoting
investment in sustainable development across the
continent. The AfricaSIF.org Project is building a network of
institutions and individuals promoting sustainable
investment in Africa by investors in public, private and
philanthropy sectors across asset classes, countries and
stakeholders from our platform www.africasif.org.
2012 HIGHLIGHTS include:
AfricaSIF.org ESG Masterclass: Education and training for
investors, pension fund trustees, consultants and
regulators. Next training planned for Johannesburg (Aug)
and Cape Town (Sept), with plans for Casablanca (Dec).
http://www.africasif.org/esg-masterclass.php
AfricaSIF.org Marketplace Trends Report 2012: A
sustainable investment benchmarking survey that looks at
investment market size and dynamics in 54 African
countries. For the first time, AfricaSIF.org will contribute
the Africa coverage in the global SIFs Trends Report in
December.
http://www.africasif.org/marketplace-and-trends-
report.php
AfricaSIF.org Networking 2012: The AfricaSIF team invites
you to meet and mingle with 100 investors and
stakeholders in Africa. Events are planned for
Johannesburg around the ESG Forum 21 Aug, 5 Sept in
Cape Town ahead of the IMN Africa Cup 2012, with plans
for Casablanca in adjacent SuperReturn Africa 3-5 Dec.
http://www.africasif.org/networking-events-2012.php
|
twi4er.com/africasif
www.africasif.org
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8. IFC Advisory Services in Africa
Advisory Services by Business Line, FY11 -
Total Project Expenditures: $207 Million
8
IFC Hub Offices
IFC Country Offices
ATLANTIC
OCEAN
Mediterranean
Sea
INDIAN
OCEAN
Cape Town
Johannesburg
Maputo
Antananarivo
Lusaka
Freetown
Nairobi
Kigali
Douala
N’Djamena
Lagos
Accra
Ouagadougou
Abidjan
Dakar
Cairo
AmmanJerusalem
Beirut
Algiers
Rabat
Sana’a
Dubai
Monrovia
Kinshasa
Addis Abala
Dar-es-Salaam
Bujumbura
Bamako
Bangui Juba
Access to
Finance
31%
Investment
Climate 27%
Sustainable
Business 29%
Public Private
Partnerships 13%
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Sustainable Investment in Middle East and North Africa 2010
MENA $54.25 billion 2.13%, MENA without Shari’ah - compliant
investments $17.1 billion 0.67%.This is a conservative estimate based solely
on disclosed data, and excludes publicly committed investments which
cannot be verified as already invested.
The main sustainability issues identified in Sustainable Investment in
Middle East North Africa 2011 are economic diversification, climate
change, water scarcity, governance reform and greater transparency, youth
development and employment, contribution of women to economic/social
development and labor conditions.
To determine the current state of development of SI in MENA, the study
used an assessment framework which primarily focused on “Market
Preparedness” and current “Market Interest” in SI among active investors in
MENA. The Market Preparedness assessment covers two components:
investment, ESG regulations and country performance; and ESG disclosure.
The level of SI in MENA is low, but not insignificant, and there is a
growing recognition of a need for action on sustainability
issues. Whereas governance reforms have been initiated, there has been
less progress on environmental and social elements of ESG. Some countries
in the region have made important strides, but many areas are still in very
early stages of development and challenges remain for the growth of SI in
MENA.
9
Sustainable
Investment
in
Middle
East
North
Africa
2010,
full
report:
hCp://www.ifc.org/sustainableinvesEng
WriCen
by:
Guy
Morgan,
BSR
and
Darin
Rovere,
Sustainability
Excellence.
Editorial
team:
Taha
Rafi,
Jason
Youmans,
and
Berit
Lindholdt
Lauridsen
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Sustainable Investment in Sub-Saharan Africa 2011
Sustainable investment (SI) is an established niche in Sub-Saharan Africa, and
predominantly in its largest institutional investment market – South Africa.
This study recommends five measures to expand SI through 2020.
The report forecasts that over the next 10 years there will be considerable growth
of ESG considerations in investment management in South Africa, Kenya, and
Nigeria.
The strongest growth will be in the ESG-integrated segment driven by major asset
owners, DFI-led PE investment, regulatory changes, and activities of SI/ESG-specialist
investment boutiques.
In both the private equity (PE) asset class and in general asset management
practice, SI as a pure-play, branded environmental, social, and governance
(ESG) investment theme totals an estimated $5.5 billion in assets under
management (AUM). However, using the broader definition to which this
report subscribes, which defines SI as investment practice that integrates
ESG factors in investment policy and/or process stages, this report
estimates that SI in Kenya, Nigeria and South Africa stands at over
$125 billion AUM (20 percent of total AUM).
The relatively high proportion of ESG-integrated investment is the result of:
Largest asset owner in the largest African investment market, South Africa’s
Government Employee Pension Fund (GEPF) with $131 billion and asset manager of
92 percent of its assets, the Public Investment Commission (PIC), both adopting
ESG-integrated sustainable, responsible and/or developmental investment policies
since 2009. Largest series of PE funds in the past decade have in part had DFI-
sponsored PE mandates in Africa
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25. Private Equity in Africa Sustainable Investment Briefings
sincosinco.com/peacchis
Project:
Client:
sincosinco.com
ifc.org
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African private equity and infrastructure…viewed as better 3 year bets
Investors moving to longer term investment strategies for Africa, rather than more speculative short-term bets. In key
African markets, investors worry more about technical risks than political or macroeconomic risks.
Institutional investors plan to increase their allocation to African markets in the coming five years. 20% had zero
current Africa allocation, in investors US$10bn, 33%. Most have as part of global emerging/frontier markets. By 2016,
expect 5% of fund value may be allocated to Africa. allocation.
Source: Into Africa: Institutional investor intentions to 2016, Invest AD + Economist Intelligence Unit, January 2012
Notes: Online survey of 158 institutional investors Aug – Sep 2011 by EIU includes insurane and pension funds, private banks, wealth managers, hedge funds, and mutual
funds, 22% have US$22bn AuM, split amongst North America, Europe,Asia-Pacific, Middle East, and Africa.
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Institutional investors in Africa…expect development outcomes
…
Source: Into Africa: Institutional investor intentions to 2016, Invest AD + Economist Intelligence Unit, January 2012
Notes: Online survey of 158 institutional investors Aug – Sep 2011 by EIU includes insurane and pension funds, private banks, wealth managers, hedge funds, and mutual
funds, 22% have US$22bn AuM, split amongst North America, Europe,Asia-Pacific, Middle East, and Africa.
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One Year Later:
IFC always needs to prove the success of their work, including reports. In our conversations with investors and
stakeholders, the audience for SI in SSA either has not fully read and digested it, or has not built on its findings.
Overview of SI in SSA and 5 recommendations
Update key data on marketplace, supply demand of ESG products services
SI in SSA AUM summary table as per little 2-pager Issue Brief
PE growth in SSA pg 49 – may not have been much change here
Portfolio/funds supply table
funds with exposure in Africa
SA specific tables
Proxy voting graphs as per “SpoiltVotes”
Changes in AO + AM + PE policy/reporting/activity
Opinions from project people on why SI in SSA matters/-ed what it's impact was/was not
Published August 2012
28
+1
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One Year Later: ESG greenwashing?
Regulation 28: The updated Regulation 28 of the Pension Funds Act 24/1956 in South Africa, language and principles were expanded to
include the concept of ESG, and in Principle IX an explicit reference to ESG (on top of references to BEE).
Code for Responsible Investment in South Africa (CRISA): The launch of a voluntary investor initiative to increase stewardship
followed similar work in Europe (voluntary in UK Stewardship Code (2010), regulation in Denmark CSR reporting, (2009) and Indonesia.
Tensions between stakeholders may be expected.The Integrated Reporting Initiative (IRI) has been adopted by the JSE as an outcome of King
III, and will meet the demand for material non-financial information.
Sustainable Investment in Sub-Saharan Africa Report: Investment practitioner views of sustainable investment in private equity
and asset management in South Africa, Nigeria, and Kenya (IFC, July 2011) determined the state and trajectory of SI in South Africa, Nigeria, and
Kenya, and provides recommendations to stimulate sustainable investment over the next five years.
Spoilt Votes Proxy Voting Report: The landscape report of proxy voting at South African asset managers by Jimmy Winfield, University
of Cape Town noted “[i]t is clear from this study that the proxy voting space for asset managers in South Africa is underdeveloped.The
importance of active stewardship of assets has been flagged in South Africa at least since the mid-1990s.
Dirty Feet : Portfolio Carbon Report Analyzing the risks and opportunities to largest 10 unit trusts and largest 40 companies on the
Johannesburg Securities Exchange from the pricing of externalities in 2011.There is a need for major S.A. JSE-listed companies to clearly
articulate to shareholders, policymakers and regulators their plans and practices in managing their carbon footprints and ESG issues. There is
also a clear case for comprehensive, mandatory company reporting on carbon in annual reports accounts.
Updated IFC ES Framework / Equator Principles 3: The Environmental and Social (ES) Performance Standards, an integral part
of the Framework, have become a global benchmark for ES risk management used by over 100 financial institutions worldwide, including 77
project financers and banks signatories to the Equator Principles .The IFC Sustainability Framework effective on January 1, 2012, incorporate
modifications on challenging issues that are increasingly important to sustainable businesses, including supply-chain management, resource
efficiency and climate change, ecosystem services, labor practices and human rights.
UNFCCC COP17 but record CO2: Hosted in Durban, South Africa, the 17th Conference of the Parties (COP17) to the United Nations
Framework Convention on Climate Change (UNFCCC) ended in “extra time” with a weak resolve to move to something substantive from
2015, to be enforced from 2020. Global carbon-dioxide (CO2) emissions from fossil-fuel combustion reached a record high of 31.6 gigatonnes
(Gt) in 2011 .
Rio+20 conference in June 2012: “At the close of the Rio+20 Earth Summit, heads of state and ministers from more than 190 nations signed
off on a plan to set global sustainable development goals and other measures to strengthen global environmental management, tighten protection the
oceans, improve food security and promote a green economy.”
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About Sustainable Returns Project
Sustainable Returns Project is an industry-led initiative to integrate environmental, social, and corporate governance
considerations into the mainstream of retirement industry investment practices in Southern Africa.The project features a
pioneering partnership between the Principal Officers Association (POA) and IFC (International Finance Corporation) to position
southern African practitioners at the forefront of global best practice. Launched in December 2011, the project will run until
December 2013.The project will provide a consistent framework and set of tools for retirement funds to comply with the new
Regulation 28 of South Africa’s Pension Funds Act and the Code for Responsible Investing in South Africa (CRISA).
Supported by funding from the Norwegian Government, the initiative was convened in 2011 by the Principal Officers
Association of South Africa (POA), IFC, the Government Employees Pension Fund (GEPF), and the Association for Savings and
Investment South Africa (ASISA).
It is led by a Steering Committee of high-level representatives from the Financial Services Board (FSB), NationalTreasury of
South Africa, Banking Association of South Africa (BASA), Botswana Public Officers Pension Fund, Congress of South African
Trade Unions (COSATU), Debswana Pension Fund, Federation of Unions of South Africa (FEDUSA), Financial Planning Institute
(FPI), Government Institutions Pension Fund Namibia (GIPF), Institute of Directors (IoD), Institute of Retirement funds (IRF);
National Council ofTrade Unions (NACTU), Pension Lawyers Association, South African Institute of Chartered Accountants
(SAICA), Southern AfricaVenture Capital Association (SAVCA),Telkom Pension Fund, and the UN-backed Principles for
Responsible Investment (PRI).
30
31. Sustainable Returns for Pensions Society Project
Project:
Client:
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ifc.org
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poa.org.za
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New primary research on retirement fund investment value chain,
insights on ESG integration
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Referencing to 2007 survey of asset
owners, investment managers and
advisors
RFIVC paper covers new material on
ESG factors in investment decisions,
attitudes, investment decisions proxy
voting
Referencing to 2011 survey of asset owners,
investment managers and stakeholders in SA,
Kenya Nigeria
RFIVC paper covers new insights on
investment decisions, education and timelines,
expert opinions on drivers in RFIVC and role
of investment management
Large Funds Survey Output supplementary report
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Analysis from primary research
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Large funds survey
• 71 survey responses
• From 156 funds universe from IRF + POA
• Distribution via IRF + POA to 3 roles: chair, chair of investment committee, PO
• 38 large funds representing 2,273,792 active members contributing (averaging
59,836/fund), 453,034 beneficiaries (averaging 12,943/fund).
Influence makers survey
• 44 expert interviews/survey respondents
• Contacts from SinCo expert networks
• Responding in personal capacity
• Diversity of representation from retirement funds,
advisors, services providers, investors, stock exchanges,
law and media
Steercom survey
• 12 responses from steering
committee members
• Representing 12/15 major
stakeholders
• Incomplete submissions from
respondents
• Gaps in respondents
• Approach to primary research shifted as responses lagged in Q2 2012.
• See Report for list of responding funds, experts, and SteerCcom respondents
Four steps
1. Review secondary research
including media and reports
2.Analyzed findings from 3 survey
groups, reviewed with UNISA
3. Feedback from peer reviewers
and PMC editorial
4. Final report including appendix
of survey responses and
stakeholder report.
Responses below
expectations,
supplemented by
expert and
Steercom insights
Material for
RFIVC paper and
information
inputs for Phases
II III
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Report 1: Defining Momentum: The retirement fund investment value
chain and the state of ESG in South Africa
Executive Summary
1.
Introduction
2.
InvestmentValue Chain
3.
Retirement Investing Systems
4.
A Brief History Of ESG In RSA
5.
2011:The ESG Tipping Point?
6.
Answering Questions
7.
The Language of ESG
8.
Big vs Small Funds
9.
DB vs DC Funds Investing
10.
Investment Knowledge
11.
Fund Roles
12.
Collaboration
13.
Reporting
14.
A Co-designed Future
15.
Some Conclusions
Recommendations
Footnotes
34
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Report 1: Defining Momentum: The retirement fund investment
value chain and the state of ESG in South Africa
Retirement funds investment practices in 2012 demonstrate awareness of the challenges/opportunities, the need
for education and ESG integration. Investment decisions in a growing African economy in the 21st century are
made within parameters of fiduciary duty and regulation, competitive investment market realities and demands
from stakeholders.Will momentum for investment integrating environmental, social and governance (ESG) factors
overcome the inertia of investment-as-usual, moving from investment policy to fund practices?
Executive summary
1. Retirement fund investments must deliver for their final client – the pensioner.
2. Retirement funds are major investors.
3. The retirement fund investment value chain (RFIVC) is increasingly complex
4. Investment with environmental, social and governance (ESG) factors is new.
Conclusions
Drawing together some conclusions in this research, in summary:
Investment returns are critical
Developed retirement system
Gatekeepers control information
Funds ESG responses differ
Investment value chain limited
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Growing fund assets “What is the proper role of retirement
funds in a growing economy in Africa in 2012?”
Influence makers survey
“Ideally, the role of retirement funds (and therefore their investors) should be to follow long term investment strategies, and
guide capital to those companies/ventures with a long term, sustainable proposition…securing long-term returns…with it many
opportunities but also risks; it's important that all these are taken into account - after all, it is people's retirements being
invested.”
Specific role is to provide sustainable returns for their beneficiaries with the flow on effect of providing income in retirement.
This can have positive benefits for both the economy and society.”
“I expect Parastatal and Government funds to play a role in infrastructure funding, but other funds will only start do so if
regulation / legislation enforces it.
“Massive and growing because retirement savings are spreading throughout the region.”
Mobilisation of savings/capital to enable economic growth and thereby ensuring a sustainable retirement prospect for
members / economy.”
Maximise returns”
“Investment professionals need strong pressure to move away from short term pressures - not sure CRISA in its present form
will do it
n=33; open-ended question; interviews and online survey of experts by SinCo for IFC+POA+IRF, March – May 2012.
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Weak observed demand for ESG
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0 5 10 15 20 25 30
Demand for environment issues
Demand for governance issues
Demand for social issues
Demand for B-BBEE issues
What proportion (if any) of your FUND members are demanding the FUND include
environmental, social and governance (ESG) considerations into your investment
policy statement?
80%+ 20 80% 5 20% 1% 5% 1%
n=26;
4
answer
opEons
with
5
categories;
online
survey
of
156
reErement
funds
by
SinCo
+
UNISA
for
IFC+POA+IRF
March
–
May
2012
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Are funds inactive stewards?
How many times in 2011 did your FUND vote your fund proxies differently to your
fund manager/s [house view]?
39
55%
14%
14%
0% 10%
4%
3%
No votes Never vote 0 5 5 10 10+ Do not know Other:
n=29; 7 answer options; online survey of 156 retirement funds by SinCo + UNISA for IFC+POA+IRF, March – May 2012
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Shifting barriers
What are the 3 biggest obstacles to incorporating ESG factors into your FUND's
investment policies/strategies?
Top-ranked barriers
Large funds survey
Lack of information
Not justified by business/investment case
Unrealistic to expect our fund to meet the
same ESG standards applied globally
Most frequently cited barriers
Lack of information
Lack of expertise
Not justified by business/investment case
n=57; 10 answer options with 3 ranking scale; online survey of
experts by SinCo for IFC+POA+IRF, March – May 2012
Influence makers survey
Other more important priorities
Lack of information
Lack of staff /experienced staff
Other more important priorities,
Lack of expertise
Lack of information
n=32; 10 answer options with 3 ranking scale; online
survey of experts by SinCo for IFC+POA+IRF, March – May
2012
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Answering Right Questions Lessons about fund fraud
What ONE thing have you / your FUND learned about responsible investment from the disaster of the Canyon Springs /
Trilinear Empowerment Trust / Sactwu disappearance of R100+ million of workers' retirement fund assets?
Large funds survey
“Conflict of Interests, corruption, lack of governance”
“[D]on't know what it entails.”
“ESG principles are a worthwhile consideration.”
“Proper Governance which includes providing enough information to Boards ofTrustees through detailed reporting mechanisms”
“There needs to be good discussion and debate at investment committee level where investments and investment performance
is critically evaluated.”
“Understand the product/service provider you're investing in.You need to ask whether the investment is suitable for your Fund
needs.There is no substitute for a proper due diligence before investing.”
“Corporate governance in the retirement industry sucks”
“Despite early detection, no action from the regulatory authorities has led to members suffering financially”
“To be diligent and not invest if you do not see a track record and know the integrity of the players involved.”
n=35; open-ended question; online survey of 156 retirement funds by SinCo + UNISA for IFC+POA+IRF March – May 2012
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Looking forward growing ESG
“In the next 5 years, to make investment that integrates ESG factors (more) attractive to INVESTORS like you, what is the ONE
thing you need to see happen?”
Influence makers survey
“The only thing that will make it more attractive is to illustrate success”
“The impact of ESG factors on corporate value needs to be better understood, quantified and incorporated into investment
analysis.”
“Asset owners (not managers) must devise their own policies and communicate them to their managers.”
“More studies on the linkage between performance and ESG integration and increased effort into trustee training”
“Proof that it supports investment returns and that it is not simply a way to justify mediocre returns or new high-margin
products for investment houses”
“The carbon tax needs to be implemented – a reality check of note”
“Education of trustees and advisors”
“Invest the time and resources to create the awareness and accountability and knowledge around the issues of ESG.”
n=33; open-ended question; online survey of influence makers by SinCo for IFC+POA+IRF, March – May 2012.
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AfricaSIF.org Marketplace Trends Report 2012
“Given Africa’s new identity as a land of possibility, the marketplace cannot afford to overlook the
importance of integrating sustainability issues in investment decisions. Africa is still in dire need of
capital that can bring about sustainable economic and social transformation. In this vein, we at
AfricaSIF saw an urgent need to create an independent pan-African not-for-profit network,
knowledgebase and advocate promoting sustainable investment across the continent.We believe that
AfricaSIF is well-positioned to play a key role as one of the strong institutional supports that ushers in
Africa next sustainability evolution.” - Kelebogile Moloko, CIO at Prowess Investment Management
and co-founder of AfricaSIF.org.
1. AfricaSIF.org Marketplace Trends Report 2012 #AfricaTR2012
maximum 30 pages + appendixes report due November 2012
definitions and survey methodology in line with global SIFs
asset size broken down by strategy, investor type, and by country
2. Global Sustainable Investment Trends Marketplace Report 2012 #GTR2012
Africa region coverage for global SIFs report due December 2012
maximum 2 pages summary, using global SIF methodology
http://www.africasif.org/marketplace-and-trends-report.php
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Tracking progress of pension funds in SA
Fernandez: ESG principles must be integrated into investment process. Beware of 'short-termism',
the Achilles heel.”
ESG in your investment process is an assessment and valuation tool and not a harsh and blunt
screening process.”
Retirees workers on retirement: It's scary..A lot of people I know can't retire..I am going to have
rely on govt pension”
24% of #pension funds report resignations to access savings to pay short term debt.”
Unions should be getting involved in education around financial literacy. ~ Isaac Ramputa
Pension funds target inflation, peer groups and the index rather than ESG issues as set out by CRISA”
Role of employer and service providers to pension funds should be to build skills of trustees. - Isaac
Ramputa
73% of the funds don't have an ESG policy in place
King 3 allows companies a cop out - either comply or explain. Interrogate those explanations. ~
Cora Fernandez
Launch of Sanlam Benchmark Survey 2012 , Midrand South Africa, 25 July 2012 #sanlambenchmark http://
www.sanlambenchmark.co.za/
46
49. sincosinco.com/sustainable-returns-project.php
sustainable investment consulting
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49
About SinCo team: Graham Sinclair
Graham Sinclair is Principal at SinCo, where his roles include sustainable investment strategist, ESG
architect and global project leader.
Graham has eight years specialist experience in sustainable investment globally after eight years in pensions
consulting and investment banking in Africa. Recent consulting engagements in sustainable investment include leading
IFC-funded research into private equity and liquid equity ESG strategies in sub-Saharan Africa in South Africa, Kenya
and Nigeria to be published in 2011, developing innovative financing mechanisms strategy and ESG index architecture
for developed, emerging and frontier markets for a Swiss-based international organization, and for a global
institutional investment firm in NewYork with a US$ one trillion AUM portfolio, designing ESG architecture across
private equity, liquid and global real estate portfolios covering philosophy and process innovations and investment
strategies. Currently he provides index architecture and stakeholder engagement for the Istanbul Stock Exchange
Sustainability Index.
As consultant to the UN, Graham developed strategy for 25 emerging markets and launched PRI in Emerging
Markets project in Q2 2007 for UNEP FI, creating a network infrastructure, building relationships with 108 investor
stakeholders including in Africa through 2008. Before launching the sustainable investment advisory boutique SinCo in
2006 in Boston, he was Product Manager at KLD Research Analytics, Inc adding to his background in pension funds
and asset management.
Graham is a former contributor to the CSR Initiative at Harvard Kennedy School, Distinguished Member of Net
Impact, alum of WWF One Planet Leaders programme and the Tallberg Forum New Leaders Program. He currently
leads the AfricaSIF Project building an independent, pan-African not-for-profit Africa Sustainable Investment Forum
network at africasif.org, member of ASISA’s Responsible Investment sub-committee, and a member of Investment
Analysts Association of South Africa, and the Network for Sustainable Financial Markets. He has lectured at more
than 25 graduate schools globally, and the most recently published work is chapters on Private Equity, Indexes and
Africa to Evolutions in Sustainable Investing [Wiley Business, 2011].
Graham earned his MBA on scholarship atVillanova University in the USA where he co-managed the Arnone-Lerer
SRI Fund equity portfolio in 2004. He holds a B.Com from the University of Natal and LL.B from the Howard
College School of Law as well as numerous industry specialist certifications. He holds diplomas in retirement funds
and insurance law, and in 1998 he was one of the youngest ever dual-FILPAs. He resides in Cape, South Africa and
Vermont, USA.
Graham Sinclair
Principal
SinCo
sincosinco.com
1 August 1970
South African
B.Com 1991, LL.B 1994, MBA 2004
Dip.RFM 1997, IISA 1998, ILPA
1999
IASSA, ELP, WWF OPL, USSIF.org
AfricaSIF.org
Experience in over 25 countries
English,Afrikaans