Level 3 Responsible investment across asset classes

Question 1

Of all Responsible investment (RI) strategies. How is that allocated. i.e how much is in equities etc.

Answer 1

46% Equities 40% Bonds 11% alternatives 3% i depos

Question 2

ESG in listed Equity What integration approaches are used Why are impact investment not well suited?

Answer 2

All integration approaches can be found with exclusion (Normes based) and engagement and voting to be that most wide spread. Given the focus on secondary market. Equities are not well suited for impact investment since they are use of proceeds driven.

Question 3

ESG in Private Equity Flip the card to read

Answer 3

Has increasingly embraced ESG of the recent past ESG has become a norm in the PE industry Reasons can be thematic. ( carbon is a key issue) but more important the general trend and pressure on the owner side to roll or ESG strategies. There seem to be an increasing conviction that ESG generates financial value in the DD and investment process

Question 4

ESG in private debt IT has the largest market share in? The investors can be XXX given use of proceeds

Answer 4

Has the largest market share in impact investing Investors can be selective and specific with regards to use of proceeds

Question 5

ESG in corporate bonds How does the time to maturity affect ESG considerations

Answer 5

It become less relevant

Question 6

ESG in Sovereign bonds What is the most commons ESG strategy Can investors engage with the issuer?

Answer 6

Exclusions especially norms based exclusions Practically impossible to exclude reserve currency bonds Engagement is almost impossible limting the investor to integrate with the issuer.

Question 7

What are the leading frameworks for green bonds (3) And what 4 pillars to they rest on

Answer 7

The Green Bonds principles Social bond principles Sustainability bond guidelines 1 Use of proceeds 2 Process for project evaulation adn selection 3 management of proceeds 4 reporting.

Question 8

Name a reason why it’s hard to implement ESG in commodities And what is the most common RI technique

Answer 8

Exchange trades commodity contracts. Differentiation is hard Exclusions is the most common technique

Question 9

Name a important driver behind exclusions in commodities And what is the alternative if you want to invest i commodities?

Answer 9

Reputational risk. Investor can potentially be dragged into controversial situations if their production have unacceptable side effects. (externalities) An alternative is to invest i commodity trading houses. The advantage is to distinguish between good and bad companies

Question 10

Name a main concern for hedge funds why ESG does to really work out

Answer 10

Hedge funds have investment horizons that does not match well with ESG integration pay off

Question 11

How can you formulate you ESG related objectives

Alignment
Intergration
Impact

Answer 11

Question 12

What is the top down process in ESG asset allocation

Answer 12

Question 13

How many are the Sustainable development goals
How may targets and indicators?

Answer 13

17 Goals

169 Targets

230 indicators

Question 14

Part of fiduciary duty when you develop an investment strategy.

What can you do

When someone has a fiduciary duty to someone else, the person with the duty must act in a way that will benefit someone else, usually financially. The person who has a fiduciary duty is called the fiduciary, and the person to whom the duty is owed is called the principal or the beneficiary.

Answer 14

Align portfolios with SDG

To invet with real world impact guided by the SDG

Intergrate SDG is asset allocation considerations from a universal owner perspective

Question 15

What are the main characteristics of ESG investment objectives

Answer 15

Question 16

Flip to see an illustrative example of impact to ESG considerations

Answer 16

Question 17

What are the main characteristics od ESG investmetn ojectives INTEGRATION

Answer 17