UK’s NEST adopts ‘climate aware’ fund for default strategy

first_imgNEST, the UK government-backed defined contribution (DC) master trust, is allocating a portion of the assets in its default strategy to a new “climate aware” fund managed by UBS Asset Management.It seeded the fund with around £130m (€154m), representing roughly 20% of its current developed equities portfolio and 10% of total investments in the default strategy. It is intended to address risks and capture opportunities associated with the move to fight climate change.The UBS Life Climate Aware World Equity fund tracks the FTSE Developed Index, but over- and underweights companies depending on their alignment with the transition to a low carbon economy.For example, a positive “tilt” will be applied to companies providing renewable energy or those making changes to meet targets in line with the internationally agreed goal of keeping global warming to 2ºC above pre-industrial levels. A negative “tilt” will be applied to companies that are heavy carbon emitters, have fossil fuel reserves, or are not adapting to the 2ºC scenario.Despite it being a tracker fund it will apply an active voting and engagement policy. This will concentrate on companies that need to adapt their business models to meet climate change goals.Mark Fawcett, NEST’s CIO, emphasised the mandate was aimed at managing the investment risks associated with climate change as well as being positioned to capture investment opportunities.In a statement, he said: “As responsible long term investors on behalf of our members, we can’t afford to ignore climate change risks and we’ve committed to being part of the solution.“Through the UBS Life Climate Aware World Equity Fund we can start reducing our members’ exposure to some of the worst financial impacts. At the same time they’ll get in early in industries and technologies that’ll help the global economy move away from fossil fuels.”Responding to questions from journalists yesterday evening, he was adamant that this was not a marketing ploy and nor was the pension fund taking a moral stance on climate change.He noted that the youngest member in NEST is 17 years old and could be investing via the pension fund for 50-60 years, a period during which “climate will change, the world economy will change”.For its youngest members, the pension fund aimed to invest 30% of the equities in the Foundation Phase of its Retirement Date Funds to the new UBS fund.NEST’s move was welcomed by the chief executives of ShareAction, the Principles for Responsible Investment (PRI), and the Institutional Investors Group on Climate Change (IIGCC).NEST is the second UK pension fund in a short space of time to have integrated climate change considerations in the investment strategy for a DC default strategy.In November last year HSBC Bank UK Pension Scheme adopted a new Legal & General Investment Management multi-factor equity fund with a climate change “tilt” as the DC scheme’s default option.Fawcett was reluctantly drawn to comment on the difference with the Legal & General fund that the HBSC scheme has adopted, saying there is “a significant difference”.In addition to being a smart beta fund with, as Fawcett described it, a “climate or low carbon overlay”, the Legal & General fund also provides for divestment from companies – something NEST had sought to avoid.Fawcett said that NEST had assessed existing products on the market but felt that none of these – active or passive – met the fund’s requirements.The pension fund had sought a forward-looking perspective by focussing on companies that are transitioning to a low carbon economy, without exclusion or divestment rules.The new UBS fund is the outcome of a year-long collaboration between the asset manager and NEST, and for NEST is also an output of three years of work on climate change.NEST was established in 2008 as a UK government-backed vehicle for its auto-enrolment pension policy. It took home the Best European Pension Fund award at December’s IPE Awards in Berlin.last_img read more

Minnesota Muslim Activist Defends His Faith Against Radicalism

first_imgFaithLifestyle Minnesota Muslim Activist Defends His Faith Against Radicalism by: – July 13, 2011 36 Views   no discussions Sharing is caring! Share Sharecenter_img Tweet Abdirizak BihiAs part of the Washington Post’s “Under Suspicion” series’ examination of the lives of American Muslims since the Sept. 11 attacks, Eli Saslow has profiled Abdirizak Bihi, whose story is another example of just how complicated those lives and our perceptions of them can be.The Somali-American man is the founder, director and sole employee of a community-based counterterrorism program in Minneapolis. He has testified at the controversial Capitol Hill hearings on Muslim radicalization, and the FBI and the Justice Department rely on his help during investigations of terrorist threats.Meanwhile, he struggles to gain financial support from the politicians who endorse his efforts, and operates with little funding from an area where at least 25 young men, including his 17-year-old nephew, have disappeared to fight for the militant Somali group al-Shabab in the past three years.Many mosques, elected officials and even law enforcement agencies have hesitated to address the radicalization of a small percentage of U.S. Muslims, because the topic itself is so divisive. The focus on homegrown jihad is considered either the next front in the war on terrorism or an Islamophobic witch hunt sure to create more ill will.Bihi describes himself as an observant Muslim who prays daily and fasts during Ramadan. He said it is his responsibility to “save the religion I love from a very small number of extremists.”Officially, Bihi is the director of the Somali Education and Special Advocacy Center, but in truth he is the center, aided only by a Samsung cellphone and a donated desk in the offices of Mo’s Building Maintenance. His program is part of an emerging movement that Washington officials refer to as “CVE,” or “countering violent extremism.” The idea is simple: Inoculate young Muslims against the risks of radicalization by making them feel entrenched and happy in their communities. The execution is much more complex.The Root Sharelast_img read more