University of Cape Town Graduate School of Business Research Seminar What is the State of Sustainable Investment in Africa?


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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 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 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 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. 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.
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University of Cape Town Graduate School of Business Research Seminar What is the State of Sustainable Investment in Africa?

  1. 1. SinCo – sustainable investment consultants © 2006-2012 FOR PROFESSIONAL INVESTORS USE ONLY – NOT FOR DISTRIBUTION TO THE GENERAL PUBLIC 1 REGULATORY INFORMATION No part of this report or proposal suggests or should understood to suggest endorsement or advice on any investment approach, strategy or offering.The rights and obligations of the investor are set out in the relevant policy contract. Market fluctuations and changes in rates of exchange or taxation may have an effect on the value, price or income of investments. Since the performance of financial markets fluctuates, an investor may not get back the full amount invested. Past performance is not necessarily a guide to future investment performance. UCT GSB research seminars hosted by Tamlyn Mawa and Ralph Hamman UCT GSB,Waterfront, Cape Town, South Africa 25 July 2012 1PM - 2PM sustainable investment consulting Designing and developing world-class ESG architecture for institutional investment in frontier and emerging markets since 2006 Graham Sinclair Principal SinCo | @SinCoESG | What is the State of Sustainable Investment in Africa?
  2. 2. SinCo sustainable investment consulting 2  
  3. 3. sustainable investment consulting NOT FOR DISTRIBUTION OR CITATION 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. Marketplace Trends Report 2012 3.  Conclusions and next steps
  4. 4. sustainable investment consulting NOT FOR DISTRIBUTION OR CITATION SinCo