TISAtech, the new industry-led digital platform for ESG technologies and FinTechs launched by The Investing and Saving Alliance, has sent a Request for Information (RFI) to over 1,700 asset managers globally to gather information about environmental, social and governance (ESG) issues facing investors and their ESG-centric investing strategies. This will be the largest and most substantive research of its kind to date.
This is in a unique collaboration with the Pensions and Lifetime Savings Association (PLSA) who support the need for indepth insights into investment strategies and future risks. The RFI has been distributed via investRFP.com, a global platform which supports institutional investors in their fund and asset manager selection process.
A primary objective of this RFI is to share the insights with trustees of UK pension schemes and asset owners to support the active management of their exposure to climate change, in line with the Taskforce on Climate-related Financial Disclosures recommendations set out by the Pensions Minister earlier this year. This will help pension trustees perform their duties which include governance of climate change as a major financial risk to their investments.
The aggregate data will be used to present those asset managers that demonstrate a commitment to ESG-focused competencies and capabilities to UK pension trustees and asset owners, highlighting expertise and innovation in the investment process. A report will also be published to all key industry policymakers and stakeholders as a mechanism to drive change and greater engagement across the industry.
UK pension schemes and their trustees will be granted access to the reponses of asset managers at no cost.
ESG is set to be part of the Markets in Financial Instruments Directive II (MiFID II) in early 2021 yet a recent report by Rathbones revealed that, despite the incoming regulation, less than a fifth (18%) of advisers said ESG advice was already fully integrated into their business.
Keith Phillips, CEO of TISAtech, said: “The worlds of investment and ESG are no longer distinct. Gone are the days when pension trustees or asset managers would look to either maximise returns or boost ESG credentials – sustainability is now at the core of any strategy in any portfolio.
“TISAtech will help financial institutions navigate the complex and evolving policy, regulatory, and business landscapes to better understand the risks and opportunities related to climate change and sustainability. With increasingly exacting reporting frameworks, a notable cultural shift in the pensions industry, and the rising impact of climate change on equities and funds, an industry-wide shift towards ESG must be made now if financial service institutions are to keep up and limit the risk posed to members’ future retirement incomes.
“This evaluation, which we hope will become an annual exercise, will support the pensions and wider financial services industry to navigate new risks and will ensure transparency. It will soon become very clear who is adapting and performing well and who is not.”
Joe Dabrowski, Head of DB, LGPS and Standards at the PLSA, said: “We’re pleased as part of the PLSA’s Investing for Good work programme to be collaborating with TISAtech on this review of asset management ESG strategies. Pension schemes are keenly aware of the impact of climate change on their investments and on saver outcomes. When investing in a climate aware way, and adapting to a fast changing regulatory environment they also need the services and support of asset managers. This results of this work has the potential to create unprecedented transparency in the industry. I know pension funds and key industry policymakers will be interested to see the report of findings.”
Albert Reiter, Founder and CEO of investRFP.com, said: “We strongly believe that restriction-free access to neutral and independent best practice implementation solutions is key for the fulfilling of fiduciary duties and attaining common ESG-related goals. In these unsettled times, digitising best practice implementation in fund and manager selection, as well as on-going screening, is not only an efficiency booster, but also a relevant part of business risk management. We are pleased to facilitate the distribution of this RFI for TISAtech and the PLSA. It is the largest of its kind and should provide invaluable insights for pension trustees and asset owners to better navigate risks and to seek better returns. Repeating this on an annual basis would provide valuable in-depth insights for the industry.”
TISAtech is part of The Investing and Saving Alliance (TISA), the cross-industry financial services membership body. It is a digital marketplace that brings together financial institutions and FinTechs for greater collaboration and innovation. Currently, ESG technologies are highly fragmented, so TISAtech provides a place for these technologies to convene.