Jun 12, 2009 - 2:11pm
"Asset consultants are key gatekeepers in the investment chain for super funds. For trustees to really effectively manage climate risks, and capture climate opportunities, they need to understand asset consultants’ approaches and capabilities,” said Fiona Reynolds, CEO of the AIST.
For the first time the opinions and capabilities on managing climate change risk and opportunity of asset consultants, who advise superfunds on asset choices on their more than trillion dollars under management, will be surveyed.
“It provides the asset consulting community an opportunity to communicate its approaches to climate change and how it intends to assist superfunds better manage the long-term risks and opportunities of climate change,” Climate Institute CEO John Connor.
In 2008, The Climate Institute and the AIST created the Australian Asset Owners Climate Change Initiative. It is the world’s most comprehensive initiative designed to assist super funds manage the risks and maximise the opportunities associated with climate change and was launched at Parliament House by the then Minister for Superannuation and Corporate Law, the Hon. Senator Nick Sherry.
The first phase of the initiative was of a survey of Australia’s largest superannuation funds, with more than AU$1bn under management, backed by best practice guidelines both of which will be updated annually. The second year of the survey is currently scheduled to be launched in September 2009 at the Australian Super Investment (“ASI”) Conference.
Meanwhile, the results from the inaugural super fund survey showed that while Australia’s largest superannuation funds acknowledge climate change as a risk to investments, steps to manage it are only at their infancy. Eighty-three per cent of respondents consider climate risks as part of trustee responsibilities and 64% of super funds are looking to alter asset consultant mandates to account for climate change related issues. However, just 9% of superfunds surveyed are trying to measure the exposure of their portfolio to climate change risks.
Pilot projects are underway with selected superfunds to build climate change capability using the AIST / Climate Institute developed Best Practice Methodology.
“Superfunds are clearly on a steep learning curve about risks and opportunities of climate change but also need regulatory certainty, along with Australian businesses, around design and implementation of the Carbon Pollution Reduction Scheme and other policies,” Mr Connor said.
“Further delay in implementing the emissions trading scheme is delaying billions of dollars of investment from superfunds and other investors in the projects, and technologies that will drive jobs and a prosperous low-carbon economy.”
Building on the success of the superfund survey in its first year, the initiative is now being expanded to Asset Consultants.
The aim is to release the Asset Consultant survey results of this survey at the ASI in September. The closing date for responses is 7th August 2009.
*The AIST and The Climate Institute are hosting a Business Breakfast on June 19th in Melbourne with speakers Professor Ross Garnaut, AIST President Ian Robertson and The Climate Institute’s Policy and Director Erwin Jackson who will have just returned from UN Climate talks in Germany.