Brunel publishes responsible investment outcomes report

All the Brunel Pension Partnership (BPP) active portfolios have surpassed their respective carbon intensity benchmarks by at least 7 per cent, according to its first Responsible Investment and Stewardship Outcomes report.

It revealed that many of the portfolios had reached "substantially lower" rates than benchmarked, and that, on aggregate, BPP’s active portfolios also have better scores against each of the Ranking Digital Rights indicators.

Furthermore, at least 35 per cent of the groups cycle 1 private market investments were revealed to be in renewable energy.

All of the groups appointed listed market fund managers are also currently achieving, or committed to achieving, cost transparency.

According to the report, BPP carried out a total 867 engagements with companies to move forward on 1,081 milestones over the past year.

This included, for instance, engagement with mining firms, which led to the creation of the first global database of tailings dams, designed help avoid a repeat of the Brumadinho dam tragedy in Brazil.

BPP also utilised 98 per cent of the votes available at Annual General Meetings, and other meetings, including voting against the re-election of the chair of the nomination committee for companies that are not on track to achieve the recommendation of the Parker review, which looked at Board diversity.

This was just one action taken by the group to encourage better industry diversity, having also co-signed letters alongside the 30% Club writing to companies including Centrica, Millennium and Copthorne Hotels, and Daejan Holdings, around their approaches to gender diversity.

Going forward however, BPP stressed that the percentage of female representation on boards for each of its active investment portfolios needed to be improved further.

As such, It has set a goal of a minimum of 33 per cent female representation on boards for the UK Active Equity Portfolio, and 28 per cent for Global High Alpha Portfolio.

BPP aims to “establish a baseline for gender pay gap in 2020”, and has called on on companies to report this data, despite it no longer being a requirement due to Covid-19.

It also encouraged companies with less than 250 employees to consider disclosing this information where practical, as BPP itself does.

The report also confirmed that whilst BPP is exempt from publishing a Modern Slavery Statement, it would be looking into enhancing its disclosures as one its 2020 objectives.

Other 'next steps' outlined in the report include a "short project” to identify the key companies falling short of best practice measures, and to reflect on the evidence emerging from the current crisis. This will then be fed into engagement plans.

It also committed to working with data providers to strengthen its analysis of human capital, and promised to work on identifying exposure to sectors that are more likely exposed to precarious employment practices, such as ‘zero hour’ contracts.

Brunel CEO, Laura Chappell, added: “Our clients have high ambitions for strong returns by investing in a world worth living in, and the BPP is proving it can help deliver those goals.

“This report reflects on a critical year that has seen successful outcomes in a wide range of sustainability themes from climate change to cost transparency.

“Partnership remains key to our success, and many of the achievements disclosed in our first report came from working with our clients and asset managers on environmental, social and governance issues.

“As the Covid-19 crisis has shown, managing these risks is crucial to protect the future interests of our clients and their beneficiaries.”

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