Sri Connect Extel Sri Manager Survey


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Sri Connect Extel Sri Manager Survey

  1. 1. ..........................................................................INDEPENDENT RESEARCH IN RESPONSIBLEINVESTMENT SURVEY 2012 (IRRI 2012)JULY 2012..........................................................................IRRI Survey 2012 1
  3. 3. EXECUTIVE SUMMARYThe first Independent Research in Responsible Investment survey (IRRI2012) was conducted in June 2012 by Thomson Reuters Extel inpartnership with www.sri-connect.comSustainable & Responsible Investment (SRI) and We would like to thank formally all participants forits sister discipline, Corporate Governance (CG), their contributions to the Survey. We look forwardhave proved resilient through the unfolding to working with you all again in future to supportchapters of the recent credit crisis and economic continued transparency, quality and integrity indownturn. Far from being seen as a luxury for this part of the investment value chain.good times, they are coming to be seen as anantidote to the foibles and failings of ‘mainstream’finance.Independent research provision has always been acornerstone of SRI & CG practice and will, nodoubt, remain so. Furthermore, as the relevant ofthese disciplines to mainstream asset allocation,sector weighting and stock selection becomes everclearer, it is timely to introduce a market-orientated process to identify innovative andclient-responsive practice in this area.The IRRI survey invited responses from allparticipants in the SRI value chain: assetmanagers, sell-side research houses andindependent SRI agencies. It received 239 votesfrom 139 different firms in 17 different countries.These votes were robustly and independentlyscrutinised to ensure data quality and integrity.The IRRI survey celebrates and rewards high-performing analysts with recognition and careeropportunity. We also hope that it will enablemanagers at research providers to identifystrengths and weaknesses in their firm’s analyticalcapabilities and to benchmark those againstpeers. Most importantly, we hope that IRRI willadd a further incentive for high-quality, client-responsive research and service.IRRI Survey 2012 3
  4. 4. KEY FINDINGSTHE ROLE OF INDEPENDENT SRI & CG RESEARCH IN INTEGRATEDANALYSISBy Mike Tyrrell, Editor of SRI-CONNECTIt has been a fascinating and hugely encouraging This ‘race to the middle’ to produce the ‘stimulusprivilege to review the results of IRRI 2012 and to research’ that is so important to the integrationtry to contextualise the role that independent SRI process presents an excellent opportunity for& CG research can (indeed must) play in the all- independent research providers that:important task of integrating sustainabilityanalysis with mainstream asset allocation, sector • Put individual analysts & their creative thinkingweighting and stock selection decisions. at the forefront of their product proposition • Are prepared to innovate and develop businessPolicy, initiatives and regulation may all be models that are more suited to high-value-needed to support the transition towards capital added research (and operate effectivelymarkets that are better governed, more alongside their core subscription-based model)economically-supportive, more environmentally- • Put clients before products – by maintainingbenign and more socially-just. But ultimately, excellent levels of service and responsivenesscapital moves when smart people challenge to client demandsconsensus thinking with creative, robustly- Releasing the wealth of talent and enthusiasmanalysed and well-communicated research. within independent research providers was one ofIntegration is achieved on an analyst-by-analyst; the inspirational forces behind the development ofresearch idea-by-research idea basis. SRI-CONNECT and we are committed toAt a macro level, the whole of SRI is one such channelling this energy to market.challenge to the consensus thinking in financial We support IRRI because we believe that an open,markets over fifty years. However, this broad transparent, market-orientated approach ischallenge now needs to be translated into needed to chart the progress of independents andhundreds of more targeted and specific to reward innovation and development.challenges. (Indeed, many analysts refer, in thevotes, to the importance of sector-specific, in- For markets to work, they need active participationdepth financially-integrated research calls.) and the free flow of money and information. We thank all of those who are participating in theseIt is easy to swallow the SRI ‘Kool Aid’ that policy, exciting research markets; we thank those thatinitiatives and regulation are the answer. It is ensure their money moves to support their wordsequally easy to assume that ‘sell-side’ analysts and, today particularly, we thank those whohold the keys to ‘integration’ and ‘mainstreaming’. completed the IRRI 2012 survey. The informationThey are, indeed, an absolutely critical part of this that you have provided moves our understandingprocess. However, as we see from the responses to of this area on. You have signed up to be part ofIRRI, the independent research sector also has an this exciting development change and we thankimportant role to play in driving SRI & corporate you sincerely for that.governance considerations into the heart ofinvestment decision-making.IRRI Survey 2012 4
  5. 5. It is clear that there is no single silver bullet tointegrating sustainability and corporategovernance factors within mainstream investmentdecision-making. But the target can equally bebrought down by a hail of lead bullets. IRRI 2012shows that we now have the ammunition. Nowtake aim…IRRI Survey 2012 5
  6. 6. QUESTIONS ASKEDIRRI 2012 asked for responses to the following COMPANIESquestions: • Which (quoted) company is best atCORPORATE GOVERNANCE communicating its sustainability & corporate governance performance to you?• Best independent corporate governance • What could companies do to improve their research provider (organisation) communications to you on sustainability &• Best individual analyst for corporate corporate governance matters? governance researchSRI• Best independent SRI research provider (organisation):• Best individual analyst for SRI researchSALES / CLIENT RELATIONS• Best client relations / salesperson for SRI & corporate governance researchRESEARCH, INNOVATION &DEVELOPMENT• Most innovative product / research piece produced in 2011/12• Most frustrating practice by SRI / corporate governance research organisations• What development would you most like to see in SRI / corporate governance research in 2012?ASSET MANAGERS• Which asset managers make best use of SRI / Corporate Governance research in your opinion?• Which asset manager is best at communicating its research needs to SRI research providers?• What could asset managers do to inform SRI / corporate governance research providers better about their specific research needs?IRRI Survey 2012 6
  7. 7. CORPORATE GOVERNANCE RESEARCH - ORGANISATIONBEST INDEPENDENT CORPORATE GOVERNANCE RESEARCH PROVIDER (ORGANISATION) Pos. Firm Percentage 1 GMI 24.2 2 ISS 12.1 3 Sustainalytics 10.6 4 Proxinvest 7.1 5 MSCI ESG Research 6.0 6 PIRC 4.4 7 EIRIS 3.8 8 Glass Lewis 2.9 8 Manifest 2.9 10 Ethos 2.3 11 Boardex 2.1 12 EthiFinance 1.9 12 SolarOn 1.9 14 Oekom Research 1.7 15 Bloomberg 1.3 15 CAER 1.3 15 Inrate 1.3 15 PHITRUST 1.3 15 Vigeo 1.3 20 Asian Corporate Governance Association 1.0 20 ECGS 1.0Named research providersThe following research providers were also namedby voters in this category:ASSET4 (Thomson Reuters), Association of BritishInsurers, Center for Political Accountability,Corporate Governance Europe, Governance forOwners, Groupe Investissement Responsable,Hermes Equity Ownership Services, IW Financial,Ownership Matters, RepRisk AG, SustainableInvestments Institute (Si2), The Corporate Library,Trustfinance, World Governance IndicatorsIRRI Survey 2012 7
  8. 8. CORPORATE GOVERNANCE RESEARCH - INDIVIDUALBEST INDIVIDUAL ANALYST FOR CORPORATE GOVERNANCE RESEARCH Pos. Analyst Percentage 1 Laurence Loubieres, Sustainalytics 9.9 2 Kimberly Gladman, GMI Ratings 7.4 3 Dayna Linley, Sustainalytics 6.6 4 Kazutaka Kuroda, EIRIS 5.0 5 Pierre-Henri Leroy, Proxinvest 4.1 6 Abel Page, EthiFinance 2.5 6 Alan Brett, Manifest 2.5 6 Alberto Bagnara, ISS (Institutional Shareholder Services) 2.5 6 Eugenia Fabon Victorino, Sustainalytics 2.5 6 Georgina Marshall, ISS (Institutional Shareholder Services) 2.5 6 Hans-Christoph Hirt, Hermes Equity Ownership Services 2.5 6 Helena Hernando, Sustainalytics 2.5 6 Irene Sosa, Sustainalytics 2.5 6 Jean Laville, Jean Laville 2.5 6 Julia Leske, Corporate Analysis: Enhanced Responsibility (CAER) 2.5 6 Linda Scott, Governance for Owners 2.5 6 Loic Dessaint, Proxinvest 2.5 6 Lucy Marcus, Marcus Ventures 2.5 6 Paul Hewitt, Manifest 2.5 6 Paul Hodgson, GMI Ratings 2.5 6 Sarah Wilson, Manifest 2.5 6 Stephane Genilloud, Inrate 2.5 6 Tessa Younger, PIRC 2.5 6 Yola Biedermann, Ethos Services 2.5Named analysts Investissement Responsable); Sandrine Lalmant (PIRC);The following analysts were also named by votersin this category:Andrew Ninian (Association of British Insurers);Barbara Evans (Bloomberg); Martin Lawrence(Ownership Matters); Olivia Rapp (Proxinvest);Rafal Budzinski (PIRC); Ric Marshall (GMIRatings); Robbert Gerritsen (MSCI ESG Research);Thomas von Oehsen (ISS (InstitutionalShareholder Services)); Vipul Arora (Solaron);Bruce Freed (Center for Political Accountability);Charles Lee (Asian Corporate GovernanceAssociation); Hunter Page (Regnan); Kristof Ho Tiu(Deminor); Marie-Pier Lamarre (GroupeIRRI Survey 2012 8
  9. 9. SUSTAINABLE AND RESPONSIBLE INVESTMENT RESEARCH -ORGANISATIONBEST INDEPENDENT SRI RESEARCH PROVIDER (ORGANISATION) SELECTIONS Pos. Firm Percentage 1 Sustainalytics 32.0 2 MSCI ESG Research 13.2 3 EIRIS 9.9 4 Vigeo 4.8 5 GMI 4.0 6 Oekom Research 3.7 7 EthiFinance 3.2 8 Inrate 2.6 9 SolarOn 2.2 10 Asset4 1.8 10 RepRisk 1.8 12 Trucost 1.7 13 Bloomberg 1.1 14 Maplecroft 1.0 15 CAER 0.9 16 Good Bankers 0.7 16 SAM Research 0.7 16 SIRIS 0.7 19 imug 0.6 19 PIRC 0.6 19 Regnan 0.6 22 CDP 0.5 22 SynTao 0.5 24 Carbon Tracker 0.4 24 Environmental Leader 0.4 24 Ethibel 0.4 24 Ethical Screening 0.4 24 ETHIX 0.4 24 Fair Pensions 0.4 24 Global Witness 0.4 24 IRRC 0.4 24 ISS 0.4 24 Proxinvest 0.4 24 Stephens 0.4 24 Sustensis 0.4 24 Thomson Reuters 0.4 24 Transparency International 0.4 24 WWF 0.4IRRI Survey 2012 9
  10. 10. Named research providersThe following research providers were also namedby voters in this category:Access to Medicines Index Foundation,Acclimatise, Alcyone, ASN Research Netherlands,Bank Sarasin, Boardex, Ceres, Earth SecurityInitiative, Ecodes, Ethos, Feri, FTSE, GES Invest,Glass Lewis, Green Eye, Greenpeace, HermesEquity Ownership Services, ICCR, IW Financial,Needham, Novethic, OFG Recherche, Platform,Proxy Impact, Suedwind e.V., SustainableInvestments Institute (Si2), Triodos Bank,Washington Analysis, World GovernanceIndicators, World Resources Institute, WorldwiseInvestorIRRI Survey 2012 10
  11. 11. SUSTAINABLE AND RESPONSIBLE INVESTMENT RESEARCH -INDIVIDUALBEST INDIVIDUAL ANALYST FOR SRI RESEARCH Pos. Analyst Percentage 1 Dayna Linley, Sustainalytics 23.9 2 Irene Sosa, Sustainalytics 11.2 3 Laurence Loubieres, Sustainalytics 11.2 4 Kazutaka Kuroda, EIRIS 5.6 5 Abel Page, EthiFinance 1.8 5 Jean-Florent Helfre, Sustainalytics 1.8 5 Julia Leske, Corporate Analysis: Enhanced Responsibility (CAER) 1.8 5 Laura Nishikawa, MSCI ESG Research 1.8 5 Ric Marshall, GMI Ratings 1.8 10 Sun Xi, Sustainalytics 1.5 11 Vipul Arora, Solaron 1.2 12 Andrew Brengle, MSCI ESG Research 0.9 12 Andrew Gaynor, EIRIS 0.9 12 Andrew Logan, CERES 0.9 12 Arne Klug, Sustainalytics 0.9 12 Ben Spruzen, SIRIS (Sustainable Investment Research Institute) 0.9 12 Cornelia Maul, MSCI ESG Research 0.9 12 Elia Tarrega, Sustainalytics 0.9 12 Emmanuel de la Ville, EthiFinance 0.9 12 Esther Hougee, Sustainalytics 0.9 12 Friedel Huetz-Adams, Suedwind-Institut 0.9 12 Gaëtan Mortier, MSCI ESG Research 0.9 12 Hannah Watson, EIRIS 0.9 12 Hideki Suzuki, Bloomberg 0.9 12 Jaideep Singh Panwar, Responsible Research 0.9 12 James Leaton, Carbon Tracker 0.9 12 Jeremy Grantham, GMO 0.9 12 Nikki Gwilliam, Vigeo (Rating) 0.9 12 Paul Hodgson, GMI Ratings 0.9 12 Philippe Spicher, Inrate 0.9 12 Susanne Marttila, oekom research AG 0.9 12 Tessa Younger, PIRC 0.9 12 Tony Czarnecki, Sustensis 0.9 12 Vanessa Ardenti, Inrate 0.9 12 Zach Larkin, Stephens 0.9IRRI Survey 2012 11
  12. 12. Named analystsThe following analysts were also named by votersin this category:Amandine Marquès (MSCI ESG Research ), AhmarZaman (Piper Jaffray & Co), Akiko Shimizu (SIRIS(Sustainable Investment Research Institute)),Alessandro Bracaglia (EIRIS), Alison George(Regnan), Barbara Evans (Bloomberg), DanielaPerito (INrate), Dietrich Wild (oekom research AG),Ellen Mayer (oekom research AG), Eugenia FabonVictorino (Responsible Research), HelenaHernando (Sustainalytics), Helena Philipova(ASSET4 (Thomson Reuters)), Ian Thomson (OnCommon Ground), Jenny Blinch (ResponsibleResearch), Jowoon Park (Korea CSR ResearchService), Julius Hansen (IMUG), Libby Edgerly(MSCI ESG Research ), Marc Fox (CarbonDisclosure Project), Markus Gruenewald (IMUG),Matthew Barg (Sustainalytics), Meriem Saber(Vigeo (Rating)), Michael Lew (Needham & Co),Naomi Selby (EIRIS), Noushin Khushrushahi(SHARE: Shareholder Association for Researchand Education), Oliver Jackson (EIRIS), Ornella DiIorio (Vigeo (Rating)), Samuel Block (MSCI ESGResearch ), Sébastien Marquet (EthiFinance),Stephane Genilloud (INrate), Susan Williams(Sustainable Investments Institute (Si2)), TamaraHardegger (Thomson Reuters), Tim Vandenberg(Washington Analysis), Typhaine de Borne (EIRIS),Yulia Reuter (MSCI ESG Research )IRRI Survey 2012 12
  13. 13. SALES / CLIENT RELATIONS (SRI & CG)BEST CLIENT RELATIONS / SALESPERSON FOR SRI & CORPORATE GOVERNANCE RESEARCH Pos. Analyst Percentage 1 Darragh Gallant, Sustainalytics 11.1 2 Diederik Timmer, Sustainalytics 8.1 3 Antonio Celeste, Sustainalytics 7.8 4 Lisa Hayles, EIRIS 4.2 5 Howard Sherman, GMI Ratings 3.3 6 Vipul Arora, Solaron 3.0 7 Tal Ullmann, Sustainalytics 2.7 8 Florence Bihour-Frezal, Vigeo (Rating) 2.4 8 Julia Haake, Oekom Research 2.4 10 Eva Meyer, MSCI ESG Research 2.1 11 Andrea van Dijk, Sustainalytics 1.8 11 Duncan Paterson, Corporate Analysis: Enhanced Responsibility (CAER) 1.8 11 Irene Sosa, Sustainalytics 1.8 11 Jean-Florent Helfre, Sustainalytics 1.8 11 Martijn van Schaik, Sustainalytics 1.8 11 Philippe Spicher, Inrate 1.8 17 Emmanuel de la Ville, Ethifinance 1.5 17 Mairead Hancock, EIRIS 1.5 17 Mark Bytheway, SIRIS 1.5 17 Naomi English, MSCI ESG Research 1.5 17 Patrick Blake, MSCI ESG Research 1.5 17 Paul Hewitt, Manifest 1.5 17 Sebastian Brinkman, MSCI ESG Research 1.5 24 Laurence Loubieres, Sustainalytics 1.2 24 Nelle Coady, MSCI ESG Research 1.2 24 Randy ONeil, MSCI ESG Research 1.2Named sales/client relations people Anderson (GMI Ratings), Ives Hup (Petercam), Jillis Herpers (MSCI ESG Research), Jorgen MorkThe following sales/client relations people were (MSCI ESG Research), Kazutaka Kuroda (EIRIS),also named by voters in this category: Kimberly Gladman (GMI Ratings), Lindsay Smart (Vigeo (Rating)), Marcus Relthford (ISSAbel Page (EthiFinance), Alan MacDougall (PIRC), (Institutional Shareholder Services)), MargaretAndre Chanavat (ASSET4 (Thomson Reuters)), Apsey (ISS (Institutional Shareholder Services)),Barbara Evans (Bloomberg), Brian Grzymski (GMI Martina Macpherson (MSCI ESG Research),Ratings), Brian Walker (ISS (Institutional Matthias Boenning (Oekom Research), MichelleShareholder Services)), Cedric Lagrange (MSCI Friedman (MSCI ESG Research), Nancy DiardESG Research), Claire Veuthey (Responsible (MSCI ESG Research), Noel Friedman (MSCI ESGResearch), Dayna Linley (Sustainalytics), Dean Research), Paula Glick (SIRI), Peter ChapmanPaatsch (Ownership Matters), Drew Buckley (GMI (Shareholder Association for Research andRatings), Elia Tarrega (Sustainalytics), GavinIRRI Survey 2012 13
  14. 14. Education (SHARE)), Pierre-Henri Leroy(Proxinvest), Rick Bennett (GMI Ratings), RickMelcher (GMI Ratings), Robert Klijn (Fair Impact),Sarah Smith (Sustainalytics), Sarah Wilson(Manifest), Silke Riedel (IMUG), Stefanie Phelan(SIRIS (Sustainable Investment ResearchInstitute)), Stefano Gilardi (INrate), TerenceBerkleef (Sustainalytics), Till Jung (OekomResearch), Tyrene Peterman (MSCI ESGResearch), Ulrika Hasselgren (Ethix)IRRI Survey 2012 14
  15. 15. RESEARCH AND INNOVATION – DELIVERED IN 2011/2012MOST INNOVATIVE PRODUCT / RESEARCH PIECE PRODUCED IN 2011/2012The following organisations/pieces received • Solaron (5 votes) – for coverage ofmultiple votes for the best research and emerging markets and use of stakeholderinnovation delivered in 2011/12: interviews • GMI (4 votes) – 3 for GMI Analyst; 1 for• Sustainalytics (9 votes) – 3 for Fracking under reports on compensation & diversity Pressure; 2 for Insurance and Climate • Responsible Research (3 votes) – all for Change; 1 each for industry reports, the Future of Fish in Asia controversies product and country risk • Si2 & IRRC (2 votes) – both for Investor manager Guide to Hydraulic Fracturing• MSCI (6 votes) – for webinars, sovereign debt • EIRIS (2 votes) – 1 for sovereign debt coverage and sector reports research & 1 for sustainability ratingsAll mentions Firm Research/Product VotesBloomberg ESG Model 1Carbon Tracker Unburnable Carbon 1Center for Corporate Accountability Political Spending Disclosure Index 1EIRIS Sovereign Debt 1EIRIS Sustainability Ratings 1Environmental Investment Organisation Carbon Rankings 1Ethifinance Global Risk Rating 1FTSE4Good ESG Ratings 1GMI GMI Analyst 3GMI Reports on compensation & board diversity 1 Annual Proxy Voting Book; Social Sustainability ResourceICCR 1 Guide; Guidelines on Investment in CommoditiesICGN Model Mandate 1Inrate Focus on empirical evidence of ESG data 1KPMG Megaforces 1Maplecroft Country reports 1McKinsey Resource Efficiency Report 1MSCI Industry reports 2MSCI Sovereign debt coverage 2MSCI Webinars 1MSCI IVA reports 1Pictet How to survive the next crisis: Is SRI the silver bullet? 1Responsible Research The Future of Fish in Asia 3Si2 & IRRC Investor Guide to Hydraulic Fracturing 2Solaron Emerging Markets coverage & use of stakeholder i’vws 5Suedwind Institut Im Boden der Tatsachen 1IRRI Survey 2012 15
  16. 16. Firm Research/Product VotesSustainalytics Industry Research Reports 1Sustainalytics Country Risk Manager 1Sustainalytics Controversies Product 1Sustainalytics Fracking Under Pressure 1Sustainalytics Insurance and Climate Change 2Sustainalytics Free, Prior and Informed Consent in the Mining Industry 1Sustensis Long-term value tracker 1Transparency International Extractive Industry Report 1Trucost Why env externalities matter to inst’l investors 1Vigeo Farm Animal Welfare 1WWF Investor Engagement Programme 1IRRI Survey 2012 16
  17. 17. RESEARCH AND INNOVATION - FRUSTRATIONSMOST FRUSTRATING PRACTICE BY SRI / CORPORATE GOVERNANCE RESEARCH ORGANISATIONSResponses to this question were articulate and ‘Im tired of tick-box research. There should be morecomprehensive. We have therefore taken the view standardisation. I appreciate Sustainalytics sectorthat reproducing them in full is more valuable reports and issues surveys. Also Solaron researchthan attempting to summarise them. on specific topics of emerging markets listed stocks - which reveals hidden bad practices.’‘Outdated research that shows a snapshot of a timethat has passed (e.g. indicating the board is all ‘Cheap services enabling clients to box tick.’male when, in fact, a woman has recently been ‘Time lapse in communication - especially at AGMappointed.) I always check the RNS feeds to double time.’check the status of the board.’ ‘Box-ticking practice that does not take into‘Insufficient engagement with their own consideration particuliarities of the company,stakeholders other than customers.’ including its risk environment.’‘A box-ticking approach that fails, for example, to ‘Shadowing one anothers research.’look at the underlying impacts of a practice (or lackthereof) on the business.’ ‘Lack of coverage emerging markets.’‘Removal of previously covered companies from ‘Incorrect data or, worse, data that is displayed asMSCIs research. They remove previously covered fact without evidence behind it.’companies if they are no longer on the MSCI WorldIndex. It makes it impossible to have an historical ‘Questionnaires.’databank of information on a given company. Itsinscrutable.’ ‘Lag in data updates.’‘Claiming that large corporates are sustainable. ‘Lack of consistency when grouping sub-categoriesThey are not. Small parts of their businesses may of research.’be. SRI ratings need to be seen in context of the realimpacts of big corporates.’ ‘Answering a specific & concrete critiques of individual company ratings by re-stating their‘I still do not see well-researched methodologies for rating policies.’tying ESG issues to stock returns.’ ‘Not mainstreaming their research. If you write a‘There is little value in pointing out something that niche piece, it will stay a niche piece.’has gone wrong after it has happened as evidencethat ESG is material.’ ‘Not respecting timeliness.’‘Three weaknesses: Box-ticking approach; lack of ‘Not providing the date of most recent update. Mereactivity in terms of research; lack of contacts with too research rather than moving to another topic.’analysts (e.g. through presentations to explainmethodology). Some of these are evolving positively ‘Corporate governance indicators could be moreat some providers.’ standardized. While specific answer categories and ratings are up to the individual‘Out-of-date SRI research.’ analyst/organization, it would be nice to have consistency in what is covered.’‘Delays of several days to time-driven researchquestions.’ ‘Providing loads of data with no context.’ ‘Not dealing in real costs.’IRRI Survey 2012 17
  18. 18. ‘Lack of professionalism in the average analyst.’ ‘Ratings. Formulaic repetition of sector data for companies without highlighting deviations &‘A lot of the reports point out shortcomings differences for specific companies.’compared to the benchmark of reporting that largercompanies with more resources provide to the ‘A lack of comprehensive governance data andmarket. Plus some of the indicators are not largely analysis and a lack of data and analysis of positivematerial.’ ESG indicators and ESG opportunities.’‘Lack of available Asian governance research.’ ‘Vague links to financial impacts and relevance to mainstream application.’‘Their separation from the rest of the companysresearch. I wish it was more embedded.’ ‘This is changing but some research organisations are just data providers instead of having a‘Limited access to analysts.’ fundamental understanding of material ESG issues in sectors.’‘Lack of analytical research or real value addingresearch which is good enough quality to jolt a ‘All products and data are not on the samefinancial analysts interest.’ platform.’‘Not taking steps--when they are relatively minor--to provide ESG coverage for companies included inmultiple indices that your firm offers.’‘Many ESG research templates are still notsufficiently sector-specific. SRI researchorganisations still need to improve the sectorexpertise of their analysts (esp. that of more juniorstaff who write the bulk of company research).’‘Filling out surveys.’‘Vigeo analysis.’‘American organizations speaking on Canadian oilsands issues without necessarily understanding theissues. Inconsistency of analysis andrecommendations of Proxy advisors.’‘Sending questionnaires.’‘Influence of Corporate Governance ratingsagencies.’‘To rate companies without checking allinformation.’‘Lost connection to financial impacts.’‘Lack of time given to fully research a company.’‘Box-ticking practices; a focus on what companiessay instead of what they actually do; analysisrelative to peer group best practices instead ofrelative to an absolute sustainability referencepoint.’IRRI Survey 2012 18
  19. 19. RESEARCH AND INNOVATION – WANTED FOR 2012/2013WHAT DEVELOPMENT WOULD YOU MOST LIKE TO SEE IN SRI / CORPORATE GOVERNANCE RESEARCHIN 2012?Responses to this question were articulate and companies outside of the US and Europe. Morecomprehensive. We have therefore taken the view evaluation and analysis, less raw data.’that reproducing them in full is more valuable ‘That it is taken up by more mainstream assetthan attempting to summarise them. managers.’‘More focus on marine resources, animal welfare ‘From an asset managers perspective, brokers areand biodiversity.’ extremely valuable because they can be reached easily and know their topic well. We do not have the‘More training and professional qualifications same ‘access’ to SRI or CG research analysts sodesigned for the sector.’ would be good for them to try to develop direct one- on-one relationships with asset managers.’‘Anything that encourages increased shareholderactivism.’ ‘Greater distinction and differentiation between exclusionary SRI research and risk-based ESG‘More research into corporate bonds issued by analysis.’private companies & expansion of ESG research inemerging markets.’ ‘That ESG firms move to create the first investment fund ESG rating, since many SRI funds are now in‘ESG performance for companies that shows the market without a clear differentiation, distortingperformance on sector-specific KPIs over the full life heavily the SRI market.’of company coverage. This would be a great way tomeasure progress.’ ‘Greater uptake of quality ESG research by asset managers.’‘SRI should become more predictive in nature andgive signals that enable investors to take ‘More on sovereign debt and how to incorporate thisbuy/hold/sell calls. There should be a more frequent into investment decisions. Also information on howupdate by companies in terms of their ongoing ESG to rank countries on different topics (e.g. humanefforts, (similar to quarterly results).’ rights etc.).’‘Clearer communication on goals and progress. ‘For ESG research providers to be seen as core,Also, more transparency, more knowledge building crucial providers and not a take the ESG issues to the next level.’ ‘Research companies to include interviews with‘More comprehensive ESG research on emerging companies on their research; research companiesmarket companies.’ redressing their bias against small and midcap (brought about by smaller companies lack of‘Use of risk/opp analysis beyond ESG. For example formal reporting).’by looking at how to measure other intangibles likecorporate culture. Geographic risk mapping to ‘More research into the benefits of goodassess exposure to risks in countries of operation.’ management of ESG impacts on investor value.’‘(1) True measurement of factual sustainability & (2) ‘Standardization.’More quality - less quantity.’ ‘Stronger linkages to core business drivers within‘ESG scoring communication.’ industries, and broader research to support fixed income and alternative investments.’‘More research on smaller companies. Too muchfocus is given to the large caps. More research onIRRI Survey 2012 19
  20. 20. ‘Increased disclosure by companies would allow absolute ESG rating. It is not about trying to fillresearch providers to conduct more relevant every datapoint.’comparisons. Increased disclosure around waterand biodiversity specifically.’ ‘Challenging the assumptions underlying mainstream research to shift it to what a‘Ergonomy of the databases.’ sustainable world means for future value, rather than just assuming historical performance will‘Risk reporting by theme.’ repeat itself.’‘Genuine willingness from asset managers to invest ‘Standardisation of reporting to better benchmarkin this area.’ firms.’‘Standardized reporting based on EU Commission ‘Certification of CSR data.’recommendations. Comparability of theinformation.’ ‘Quantification in terms of costs/gains, if possible, of CSR impacts.’‘Integration of CSR risks into the analysis.’ ‘More companies covered by SRI research.’‘More performance data.’ ‘More access to relevant ESG raw databases.’‘More trend indicators of ESG rating andperformance.’ ‘Analysis of the cost to companies from lack of attention to social issues. While the business case is‘Further effort on delivering verified and comparable clear, Ive not seen much on the costs of inadequateSRI data about companies.’ human rights due diligence. Examples of this by sector / industry would be helpful.’‘More structuring of qualitative information on thebasis of GRI reporting standards.’ ‘More corporate governance metrics.’‘More sophisticated and honest ESG integration.’ ‘Better quality and more research coverage of Asian companies, especially smaller listed Asian‘A transition towards ESG beta, and collective companies.’investment strategies regarding inclusive greengrowth.’ ‘Stronger focus on materiality - when and how ESG issues are material.’‘More research on indigenous relations, corruption,risks and opportunities related to water scarcity.’ ‘Thematic reports that promote engagement on sensitive environmental and social issues.’‘Addressing the ethical implications of investing inraw materials. This is relevant for PRI, Global ‘Wider attention to shareholder resolutions beingCompact, and covers the entire mainstream filed throughout the world.’investment scene.’ ‘Energy and water nexus; diversity at board / senior‘Integration into mainstream reporting. Or is that management level; conditions for next greentoo optimistic? Perhaps showing the materiality of agricultural revolution.’SRI: the financial implications of supposedly non-financial issues.’ ‘I think it would greatly benefit the field if all players (users and providers) make a clearer distinction‘More webinars that pair research firms with NGOs between values-oriented research (exclusionary,and asset managers to discuss emerging issues norms-based) and financially-material ESG factors.collaboratively.’ Mixing the two confuses the aims of both.’‘The understanding that we are moving away from ‘For asset managers and asset owners to providenegative screening & exclusion still often being greater public transparency on their understandingpresented as ESG integration. An increased of and adoption practices of ESG within theirunderstanding that there is no such thing as an investments. For their commitment to be spokenIRRI Survey 2012 20
  21. 21. about with greater conviction, outside of the ‘Concrete integration of ESG across AUM and assetimmediate SRI community.’ classes - which requires buy-in from senior management.’‘Asset owners taking their responsibilities under theStewardship code very seriously and reporting ‘Increased dialog between SRI Research Providersannually on their progress including some trend and Asset managers.’analysis.’ ‘Regulation of proxy advisor services.’‘I am afraid that we may lose some content as non-SRI firms begin to ‘integrate’ ESG research into the ‘Is impact investing detracting from SRI growth?’investment decisions. Hope research still is cateredto deep-diving, truly integrated institutions.’ ‘Clarifying the SRI versus ESG spaces: there is room for both and they pursue different goals but this has‘Fixed Income research; materiality of different SRI / not been clearly set yet. Should be a priority for allGovernance issues.’ players and would help serving the needs of the respective players.’‘Integration of an ‘economic’ sustainabilitydimension.’ ‘More commitment of traditional broker/asset managers. New entrants / products.’‘Embedding sustainability within annual report,including the use of natural capital and likely costs. ‘More info about the effects of global warming andMore interconnection between fund managers and climate change.’SRI analysts.’ ‘Further integration of financial and non-financial‘The aspect of integrity, corporate culture, best analysis. Show profitable business cases initiatedmeasured via identification of breaches and how by non-financial issues.’this translates into higher risk premium in case ofpoor crisis management and measures.’ ‘Mainstream adoption.’‘A continued movement toward integration of ESG ‘Effective use of research for informed decisionresearch into fundamental research.’ making and not just compliance.’‘Clear (but limited) ‘fail’ list for companies whose ‘Further integration of sophisticated sustainabilitygovernance performance falls FAR below strategy and performance into investorneeds/expectations.’ communications (roadshows, annual reports etc.).’‘ESG analysis for alternative asset classes.’ ‘Political risk analysis, issues related to business ethics, energy efficiency/reduction strategies, green‘More in-depth attention to the intersection of building norms, information on access to financetechnology and civil liberties.’ (microfinance, microcredit, zero savings accounts, micro loans, etc), impact investing etc.’‘More analysis / elements on executive pay.’ ‘New product in country sustainability.’‘More sector-specific insights.’ ‘Development of engagement activity.’‘I would like to see service providers have moreanalysts with industry experience (e.g. a banking ‘Innovative research approaches.’analyst who had actually worked in banking, or anoil analyst or worked for an energy company). We ‘Further movement away from tick-box approach;primarily rely on our own buy-side analysts because nuanced understanding of different ways publictheir experience.’ companies can promote corporate governance / ESG performance etc.’‘Two separate scoring systems, one based ondisclosure and one based on performance with Y-o- ‘Contextualising of ESG information within anY graphs.’ investment context; fewer errors; less reliance on formulae and ratings.’IRRI Survey 2012 21
  22. 22. ‘A service for experienced analysts rather than thoseneeding starting points and initial guidance.’‘Inclusion of positive indicators, which would enablethe users to capture ESG opportunities better.’‘More governance research and better financialapplication.’‘Commonality over acronyms. Drop SRI and use theterm ESG.’‘Focus on what really matters for a company, wheredoes a company have the biggest impact, where areits biggest risks and opportunities.’‘More legitimacy and increasing integration withfinancial data.’‘Wider company coverage in Emerging Markets.’‘Real integrated web-based platform for allproducts: more features, better design, user-friendly.’‘Data should be updated on an ongoing basis assoon as data change (ex: change in management,new sustainability information.’IRRI Survey 2012 22
  23. 23. ASSET MANAGERS – BEST USERS OF SRI/CG RESEARCHWHICH ASSET MANAGERS MAKE BEST USE OF SRI / CORPORATE GOVERNANCE RESEARCH IN YOUROPINION? Pos. Firm Percentage 1 Co-operative Asset Management 9.9 2 Sparinvest AM 7.7 3 Calvert Investments 4.8 4 Amundi 4.1 4 Bank Sarasin 4.1 6 F&C Asset Management 3.3 7 Axa IM 3.1 8 Sustainable Asset Management 2.9 9 Allianz Global Investors 2.7 10 Nordea Investment Management 2.5 11 BNP Paribas Investment Partners 2.1 12 Aviva Investors 1.9 12 Natixis AM 1.9 14 DWS/DB Advisors 1.7 14 Norges Bank Investment Management 1.7 16 Robeco 1.4Named asset managers Services, MSCI ESG Research, NEI Investments, Newton IM, Nikko Asset Management, Osmosis,The following asset managers were also named by Paradice, PAX World, Perpetual, PGGM, Philips,voters in this category: Phitrust, Pictet Asset Management, Portfolio 21, Rockefeller Financial, Sampension, Schroders,Australian Ethical Investment, Acadian, Advanced SNS Asset Management, Solaris, Standard Life,Investment Partners (AIP), AGI, Aperio, APG, Strorebrand, Sustainable Capital, Sustainalytics,Auriel Equities, Ausbil, Baillie Gifford, BAWAG SWIP, Swisscanto, Sycomore, Threadneedle, TIAA-P.S.K. Invest, Blackrock, Boston Common Asset CREF, Trillium Asset Management, TriodosManagement, BT Investment Management, Caisse Investment Management, UBS Assetde dépôt, Calpers, CCR AM, Clearbridge Advisors, Management, Union, USS, Vontobel AM, Walden.Colonial First State Global Asset Management,Dexia Asset Management, Ecofi Investissements,Equigest, ERAFP, Ethiea Gestion, Financière deChamplain , Financière de lEchiquier, GenerationInvestment Management, Goldman Sachs AssetManagement, Groupama AM, Hermes, HSBCAsset Management, Hunter Hall, Industry FundsManagement, ING Bank, Invesco, Investec AssetManagement, Jantz-Morgan, JP Morgan AM,Kempen Capital Managers, La FinancièreResponsable, Lazard Asset Management, LeggMason Investment Counsel, Macif Gestion, MNIRRI Survey 2012 23
  24. 24. ASSET MANAGERS – BEST COMMUNICATORS OF SRI/CG NEEDSWHICH ASSET MANAGER IS BEST AT COMMUNICATING ITS RESEARCH NEEDS TO SRI RESEARCHPROVIDERS? Pos. Firm Percentage 1 Co-operative Asset Management 9.8 2 Calvert Investments 8.4 3 Sparinvest AM 5.3 4 Amundi 4.4 5 Axa IM 3.6 5 Bank Sarasin 3.6 5 CCR AM 3.6 8 Robeco 3.1 8 Sustainable Asset Management 3.1 10 Investec Asset Management 2.7 11 Aviva Investors 2.2 11 DWS 2.2 11 La Financière Responsable 2.2 14 Allianz Global Investors 1.8 14 Calpers 1.8 14 Rockefeller Financial 1.8Named asset managers Investment Management, UBS Asset Management, Vinis (VBV Group), Vontobel AM,The following asset managers were also named by Walden.voters in this category:APG, ASN Bank, Auriel Equities, Australian EthicalInvestment, BNP Paribas Investment Partners,British Columbia Investment ManagementCompany, BT Investment Management, carpers,Colonial First State Global Asset Management,Ecofi Investissements, Equigest, ERAFP, F&CAsset Management, Generation InvestmentManagement, GLG Partners, Groupama AM,Industry Funds Management, Ircantec, KempenCapital Managers, Legg Mason InvestmentCounsel, Nordea Investment Management,Norges Bank Investment Management, PAXWorld, Perpetual, Pictet Asset Management,Portfolio 21, RBC Wealth Management, RoyalLondon Asset Management, SNS AssetManagement, Standard Life, Sustainalytics,Swisscanto, Threadneedle, TIAA-CREF, TriodosIRRI Survey 2012 24
  25. 25. ASSET MANAGERS – IMPROVING COMMUNICATIONSWHAT COULD ASSET MANAGERS DO TO INFORM SRI / CORPORATE GOVERNANCE RESEARCHPROVIDERS BETTER ABOUT THEIR SPECIFIC RESEARCH NEEDS?Responses to this question tended to be multiple ‘Better communication with analysts. Particularlyvariations on the theme of: “Tell us more about about clients needs and any company engagementwhat you need”; “Tell us more about your research that they have had.’processes”; “Tell us more about how you and yourportfolio managers use the information that we ‘Explain clearly how they want to integrate ESG.provide”. We’ve selected a few responses that we There is still a lot of knowledge lacking at assetthink are most clearly articulated and a couple of managers that are talking about integration whileless common but interesting ideas: in reality they are being old style SRI investors. Be clearer where and who you are and what you are‘Meet with them, take them through a typical day ready to achieve.’and how the research is used, feedback as andwhen comments come to light, have higher ‘Put fundamentals / mainstream analysts in touchexpectations, commission research.’ with SRI analysts and research providers, provide additional information on how they are using the‘Clearly define their view of materiality and what is research in their processes, be proactive atmaterial to them - with evidence where possible.’ beginning discussions on specific themes of interest.’‘Be more specific about how the SRI teams workwith the portfolio managers, and to what extent the ‘It is useful to know the varied uses and users withinPMs value and integrate SRI inputs.’ their organization of ESG research. I think a more interactive, collaborative approach will help research‘Workshops between users of research and research providers better tailor the offering -- and prioritizeproviders would be helpful - to strengthen feedback coverage and functionalities.’and to identify coherent response to commonneeds.’ ‘Allow the provider to spend more time with the investment teams to understand the systems and‘Take more time to explain what they do exactly processes the research has to fit within, includingincluding what has worked with previous research the culture, physical location of teams, and howsuppliers, what has not worked, what their information will be shared.’requirements are in terms of reporting to clients etc.’ ‘Prepare simple, clear RFP documents which include‘Be willing to pay for it.’ an overview of the investors beliefs concerning the links between sustainability factors and investment‘Communicate needs to all the providers.’ returns.’‘Work more closely with research providers on ‘Pay properly!’implementing ESG strategies into their models, andinclude the research providers more in policy and ‘More face-to-face meetings. More check-in queriesproduct development.’ by the research providers on the asset managers impression of the research (overall) or specific piece.‘Participate in surveys.’ More responsiveness and outreach by service‘Work out what they are first! Asset managers often providers.’feel they should ask for stuff they dont necessarilywant.’IRRI Survey 2012 25
  26. 26. ‘Proactively communicate their needs in writing.Share information on their process and users, andspecific examples of what has been helpful/nothelpful.’‘Have more informal conversations during industryconferences.’‘We often question the AMs on their needs duringwhat we call ""consultation process"" and rarely geta clear responses as everything seems to be apriority to them. So getting more clarity on whatshould be prioritized would really help us in bettermeeting their needs.’‘ESG teams or co-ordinators could explain how theportfolio managers use ESG data in dailyinvestment decision-making.’‘Pick up the phone!’‘Clarity in terms of their objective. Describe clearlywhere they wouldnt want to invest and in whatareas they are open to new information or trends.’‘Communicate end-client requirements;Communicate the type of funds research is beingapplied to; Provide feedback on equities research.’‘Co-sponsor the development of research productthat they would use (e.g. specify, pilot, pre-commit)rather than forcing research providers to take stabsin the dark.’‘Continue to meet with research providers to explainyour needs and review their offerings - even if youhave never used their services.’‘Give feedback on existing products; propose newfeatures / products to research providers; establisha partnership relationship with research providers -better than a commercial relationship.’IRRI Survey 2012 26
  27. 27. QUOTED COMPANIES – BEST COMMUNICATIONSWHICH (QUOTED) COMPANY IS BEST AT COMMUNICATING ITS SUSTAINABILITY & CORPORATEGOVERNANCE PERFORMANCE TO YOU? Pos. Firm Percentage 1 Unilever 4.8 2 Royal Dutch Shell 3.9 3 Intel 2.6 3 Novo Nordisk 2.6 5 Marks & Spencer 2.4 6 BMW 2.2 6 Danone 2.2 6 LOreal 2.2 9 BP 1.7 9 Nestle 1.7 9 Philips 1.7 12 Dell 1.5 12 STMicroelectronics 1.5 14 AGL Energy Ltd 1.3 14 AkzoNobel 1.3 14 Bayer 1.3 14 Fiat Group 1.3 14 GSK 1.3 14 Intesa Sanpaolo 1.3 14 Microsoft 1.3 14 MSCI 1.3 14 Pirelli 1.3 14 Renault 1.3 24 Air Liquide 1.1 24 Bombardier 1.1 24 BT Group 1.1 24 DSM 1.1 24 EDP 1.1 24 Generali 1.1 24 Henkel 1.1 24 PepsiCo 1.1 24 RWE 1.1IRRI Survey 2012 27
  28. 28. Named companiesThe following companies were also named byvoters in this category as being goodcommunicators:Adidas, Aggreko, Allianz, American Water WorksCo, Anglo American, AngloGold Ashanti, Apple,AstraZeneca, Baker Hughes, Bank of America,BASF, BBVA, BHP Billiton, BIC, BNP Paribas,Campbells Soup Company, Capgemini, Casino,China Shenhua, Citigroup, CN Railway, Coca-Cola,Coca-Cola Amatil, Deutsche Bank, DeutscheBoerse, Diageo, Dow, DuPont, Enquest, Essilor,Exxon, Fortum OYJ, GDF SUEZ, Geberit AG,Gecina, Gildan Activewear, Goldman Sachs, GPTGroup, Groupe Steria, H&M, Hammerson ,Heineken, Hewlett-Packard, Holcim, Holmen,iberdrola, IBM, Imerys SA, Insurance AustraliaGroup , INTC, Kingfisher , Lafarge, McDonaldsCorp, Medtronic, Michelin, Millicom, MunichRe,Nike Inc, Origin Energy, Outokumpu, Petrobras,PPR, Range Resources, RBS, Repsol, Rhodia, RioTinto, Roche, Ruukki, Sanofi, SAP, SCA, SchneiderElectric, SEB, Severn Trent, Siemens, Smith &Nephew, Societe Generale, Sonova, StandardChartered, Staples, Stockland, Stora Enso,Storebrand, Suez Environnement, Suncor, SwirePacific, Symrise, Teck Resources, Telecity, TheGap, Toronto Dominion Bank, Tullow Oil, Umicore,UniCredit, Vodafone, Westpac BankIRRI Survey 2012 28
  29. 29. QUOTED COMPANIES – IMPROVEMENTSWHAT COULD COMPANIES DO TO IMPROVE THEIR COMMUNICATIONS TO YOU ON SUSTAINABILITY &CORPORATE GOVERNANCE MATTERS?Responses to this question were articulate and ‘Detailed carbon footprint, dialogue with theircomprehensive. We have therefore taken the view stakeholders, responsiveness to allegations andthat reproducing them in full is more valuable sanctions.’than attempting to summarise them. ‘Standardized integrated reporting would be‘Would prefer to see downloadable beneficial. Most American companies do well withCSR/Sustainability reports rather than interactive reporting corporate governance matters, but do notonline versions without search facilities.’ do well reporting on sustainability issues (no integrated with 10Ks or stand alone CSR reports).’‘Online databases.’ ‘Use GRI, including sector supplements. Use data‘More GRI reporting.’ charts to summarize performance, and progress on goals, with at least 3, but preferably 5 years of data‘Focus on sustainability issues that they view as - and place all charts in a single section of reports.’most material to their future prospects, providequantitative data that is comparable over time and ‘Annual ESG roundtables/lunches with key figures,with industry peers.’ participating in webinars/seminars etc be willing to talk through questions as and when they arrive …‘Answer our questions; use standardized reporting.’ and answer my correspondence!’‘Transparency on coverage of information reported ‘Integrated reporting.’(policies, indicators, measures); simplify theirreporting to key managerial elements put in place.’ ‘Meet with investors - not only on Environmental and Social issues but on Governance issues too.‘Harmonize quantitative indicators further (i.e. use Integrate SRI and CG investor feedback in annualthe same indicators, with comparable scope, and reporting.’stick to them over time.) This requires some industrysynchronization of reporting efforts. Fo further in ‘Be more honest about political donations and dontthe structuring of qualitative information.’ muddy the waters with PACs etc. Also more transparency on lobbying, donations to think-tanks‘More KPIs/hard facts.’ and other astro-turfing activities.’‘Make their webcasts easier to log into.’ ‘Incorporate sustainability information into the annual report, as recommended at the Rio+20‘Use GRI reporting standards; use consistent event. Lots of separate reports mean it’s easy tometrics each year; include clear and quantifiable miss important ESG issues facing companies.’goals and report on progress to those goals.’ ‘I recommend regular mention of sustainability and‘Organise more meetings.’ corporate governance matters in investor‘Make them integral to company strategy, not an presentations as well as specialized presentationsextra - explain why sustainability is at the heart of (annually is sufficient) on these topics.’how they do business. If it isnt, then dont bother ‘Be more precise, communicate and publish cleartalking about it.’ policies and programs. Be more transparent aboutIRRI Survey 2012 29
  30. 30. degree of progress and eventual aims. Use ‘Return profiles to us with comments.’quantitative targets where relevant.’ ‘Comparable and verified reporting on KPIs that are‘Be more honest that they are not really sustainable, relevant to their business.’just moving very slowly in that direction. Say moreabout financial benefits and costs of their ESG ‘They could systematically have their CSR datastrategies.’ certified by an independent organisation.’‘Implement GRI reporting. Commit to the UN ‘Provide measurable / quantitative information.’Global Compact. Provide data to CDP.’ ‘Provide data such as ESG metrics and operational‘Ignore the fluff (the 50 surveys and questionnaires metrics in download-able spreadsheet format. Also,that are not well designed and that ask for data if a company tries to follow GRI guidelines, givingthey have already revealed). Put their GRI map in a short and concise summaries of each GRI sectionplace where it is easily accessible.’ would be helpful as opposed to giving a page reference.’‘Improve consistency in communication towardsinvestors and research agencies. Increase public ‘Have someone senior who is familiar with thedisclosure of multiple year data.’ requests of those interested in sustainabiliity/CG matters.’‘Certification by external auditors; shorter reports;focus on KPIs, with historical data when possible; ‘Genuinely integrate their sustainability strategy,publish news on CSR/ESG issues (on a relevant and management and performance into their annualreasonable frequency: quarterly, semi-annual - just financial reporting.’like financial communication.’ ‘Have more disclosure of practices available in the‘More distribution via general media.’ public domain.’‘More regular ESG roadshows as opposed to ad hoc ‘Consistent use of KPIs (i.e. that cover a period of 3+ESG investor meetings.’ years) that are clearly disclosed in annual reports/CSR reports. Clear outline of board level‘Change the CSR departments from the responsibility for ESG issues.’communications department to the investorrelations department, or much better create the ‘Companies should be transparent andChief Sustainability Officer to report to the CEO & sit comprehensive in their communications.’on the Executive Board.’ ‘Be transparent and consistent on year to year‘Better alignment with financial reporting cycles; reporting. Include selected quantitative info on thedisclose what is material in a comparable way.’ key / strategic areas for the business and report them in the annual report and not a specific CSR‘Take our suggestions to the board; work on report.’remuneration transparency.’ ‘Plain language discussion of the principles behind‘Avoid ""cut and paste"" responses to questions on their activity - to demonstrate the extent to whichsustainability and corporate governance. Include as they are aiming to control risks or add value - or themuch performance data as possible to illustrate extent to which they are aiming to tick boxes.’systems are working as well as descriptivecomments to explain anomalies in performance ‘Offer to investors meetings with practitionersdata.’ (purchasing managers, operational managers); Give more details on the inner workings and reality of‘Provide data sheets with 5 years of data.’ operations for a board and its members.’IRRI Survey 2012 30
  31. 31. ‘Offer annual dedicated meetings with ESG teams ‘Integrate reporting of financial and non-financialand mainstream fund managers.’ issues.’‘Trim down CSR reports to focus on the material ‘Special SRI investor days.’issues for a company. Its not about 120 page CSRreports. Make other relevant data available on their ‘Publish one single report on sustainability matters,websites.’ including some links for some development, but without disseminating information all over their web‘More quantitative data on their improvements over site and many different reports.’the years.’ ‘Report EHS performance data to a standard that‘Sustainability Report in English is a must. It should enables benchmarking and compare their ownbe made according to GRI G3 guidelines. Top performance to industry benchmarks. Providemanagement roadshows with a special focus on access to operational management, especially onESG issues. Specialist company ESG presentations controversial issues.’for investors.’ ‘Make it easy to figure out, on their websites, what‘More concise reporting, more quantitative data and specific person to contact with questions andtrasparency on senior and board responsibility for provide that persons email address.’ESG issues. ‘ ‘Communicate direct links between sustainability‘Understand that philanthropic programmes and and competitiveness/financial performance.’initiatives are not relevant to analysing the effects ofsustainability and corporate governance on ‘Integrated Reporting.’operations; report data to Bloomberg ESG; workwith brokers to organise SRI roadshows.’ ‘More relevant and material quantitative data & metrics.’‘More detail on environmental and social policies,processes, statistics and targets in general.’ ‘Include all their up to date information in one place - either on the website or in an annual CSR report.‘Pare down their reporting and stick to what is most Do not publish overlapping information in differentimportant. Fewer anecdotes, more data.’ places without clear indication as to which is the most recent information.’‘Integrated reporting that shows how ESG issues arereally embedded in the companys business model ‘Connect you to the company expert on whateverand strategy.’ issue you are discussing.’‘Clear and easy accessible/user friendlydocumentation. Do not spread information out allover the website, AR, CSR & GRI reports. Pleasekeep to the same format over the years with a goodindex.’‘Integrated Reporting.’‘They can separate the data from all the text andpretty pictures. We would most prefer thatcompanies put their KPIs on one page, withachievements versus goals clearly listed. We prefermore quantitative metrics and fewer case studies.’IRRI Survey 2012 31
  32. 32. EXTELEstablished in 1999, when Thomson Reuters CONTACTSacquired the Extel Survey from the FT Group (part Thomson Reuters Extelof Pearson). The Thomson Reuters BuildingInitially 5 people, the team has expanded over theperiod 1999-2012 to a current strength of 25. 30 South ColonnadeThis expansion has both enabled us to develop Canary Wharfthe Pan-European Survey to become the leadingindicator of investment industry opinion in Europe, London E14 5EP, UKand to respond to the demands we have had for T. +44 (0) 20 7542 7700additional survey and investment industryresearch consultancy work. F. +44 (0) 20 7542 7704Our policy is to keep the consultancy team as E. extelsurveys@thomsonreuters.comsmall and focused as possible, in order that weprovide direct service to each of limited number www.extelsurveys.comclients.ACTIVITIES• Thomson Reuters Europe• Thomson Reuters UK Small Caps• SRI (socially responsible investing) (undertaken in conjunction with UKSIF – the UK industry group for social investing)• Thomson Reuters Extel Asia & Japan• Consultancy projects on behalf of sellside firms, buyside houses and quoted companies. We have undertaken a range of specific assignments over the last 6 years for organizations in all three of these areas. As is usual with this work, client names and the nature of the work remain confidential. They include a major US investment bank, several European investment banks, two UK-based FM institutions and quoted companies in insurance, pharmaceuticals, real estate and transport.IRRI Survey 2012 32
  33. 33. SRI-CONNECTSRI-CONNECT ( is an online SRI-CONNECT USER BASEglobal marketplace for SRI research and meeting The site currently has over 1,500 registered userspoint for companies, investors and their respective spread over the following geographies and useradvisors. It provides practical research resources types:and communications channels to accelerate theinclusion of sustainability factors in mainstream Geographical spread of SRI-CONNECT usersanalysis & investment. • UK – 40%The site enables users to: • USA & Canada – 16% • France – 10%; Rest of Europe – 25%• understand developments in SRI and its • Asia – 4%, Australia – 3%, Other – 2% interface with mainstream investment practice Spread of SRI-CONNECT user types• present themselves to the SRI industry and • SRI research providers – 40% review the sustainability & investment activity • Asset managers – 30% of others • Quoted companies – 10%• manage information and relationships with • Asset owners – 3%, Investment consultants – peers, partners, suppliers and customers 2% • Others (all with direct professional exposureSRI-CONNECT’S BUSINESS MODEL: to CSR & SRI) – 15%• 20% of the site’s value is free-to-view;• 40% requires registration (free, but only CONTACTS available to those with a professional Mike Tyrrell exposure to CSR, IR, SRI or CG);• 40% requires a modest subscription (which Editor, SRI-CONNECT costs less than one day at a conference!) T. +44 (0) 20 7119 6640 E. mike.tyrrell@sri-connect.comKEY FEATURES OF SRI-CONNECT:• Market Buzz –peer to peer news channel highlighting what’s happening in global SRI• Directory – SRI’s Who’s who’ containing profiles of over 5,000 companies, individuals, funds & indices• Info & Comment – comprehensive & dynamic analysis of sustainable business & the SRI industry• SRI Network – The SRI industry’s communications centreIRRI Survey 2012 33