A Transparência e a Sustentabilidade no Mercado de Capitais
Curtis Smith, BNYM Regional Director
16 de julho de 2009
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Agenda
I. Overview of SRI Universe
II. Approaches - Europe vs. USA
III. BNY Mellon IR Survey Results
IV. Emerging Market Disclosure Project (EMD)
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SRI assets represents 11% of total US AUM
SRI assets rose more than 324% (1995: $639 billion / 2007: $2.7 trillion)
Key Figures
Total assets under management in US
$25.1 trillion
Total SRI assets in US
$2.7 trillion
Source: Social Investment Forum. 2007 Report on Socially Responsible Investing Trends in the United States.(*)socially responsible investors comprise individuals and institutions, such as universities, hospitals, foundations, insurance companies, public and private pension funds, nonprofit organizations, and religious institutions. Institutional investors represent the largest and fastest growing segment of the SRI world.
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How many SRI mutual funds are there?
1995 1997 1999 2001 2003 2005 2007
Number of funds 55 144 168 181 200 201 260
Total net assets ($B) $12 $96 $154 $136 $151 $179 $202
Source: Social Investment Forum. 2007 Report on Socially Responsible Investing Trends in the United States.
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1 CREF Social Choice Account TIAA-CREF Investment Management 3,784.63 SRI (Social)
2 BlackRock Global Funds - New Energy Fund BlackRock Investment Management (U.K.), LTD 2,162.10 SRI (Social), Sector Specific
3 Parnassus Equity Income Fund Parnassus Investments 1,315.92 SRI (Social)
4 Julius Baer Multipartner SICAV - SAM Sustainable Water Fund SAM Sustainable Asset Management 1,189.01 SRI (Social)
5 Pax World Balanced Fund Pax World Management Corp. 971.44 SRI (Social)
6 Pioneer Funds - Global Ecology Pioneer Investment Management, LTD (Ireland) 949.08 SRI (Social), SRI (Environmental)
7 Neuberger Berman Socially Responsive Portfolio Neuberger Berman Management, LLC 857.87 SRI (Social)
8 Ariel Fund Ariel Investments, LLC 852.80 SRI (Social)
9 Calvert Social Investment Equity Portfolio Atlanta Capital Management Company, LLC 757.19 SRI (Social)
10 Ariel Appreciation Fund Ariel Investments, LLC 743.57 SRI (Social)
11 Hunter Hall Value Growth Trust Hunter Hall Investment Management, LTD 699.19 SRI (Social)
12 Calvert Large Cap Growth Fund Bridgeway Capital Management, Inc. 670.14 SRI (Social)
13 Stewardship Investment Funds ICVC - Stewardship Growth F&C Management, LTD 652.37 SRI (Social)
14 Pensionskassen for Socialrådgivere og Socialpædagoger PKA Pension (Pensionskassernes Administration A/S) 631.71 SRI (Social)
15 Investors Summa Fund I.G. Investment Management, LTD (Canada) 631.71 SRI (Social)
16 Nomura Asset Pictet World Water Mother Fund Pictet & Cie 579.49 SRI (Environmental)
17 PowerShares WilderHill Clean Energy Portfolio Invesco PowerShares Capital Management, LLC 572.45 SRI (Environmental), Sector Specific
18 New Covenant Growth Fund Sound Shore Management, Inc. 511.67 SRI (Social)
19 Ecureuil Bénéfices Responsable Natixis Epargne Financière Gestion 505.99 SRI (Social), Quantitative
20 LPI Aktier Europa II Lægernes Pensionskasse 500.90 SRI (Social)
Fund NameEquity Assets
(USD, mm)Parent Name Focus Strategy (EQ)
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Top 20 SRI (Social & Environmental) Funds - Global
Source: BNYM DRInsight
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Fund Name Parent Name Primary Institution TypeValue (Brazil),
USD, mmEquity Assets
(USD, mm)
1 PowerShares WilderHill Clean Energy Portfolio Invesco PowerShares Capital Management, LLC ETF 30.14 572.45
2 Julius Baer Multipartner SICAV - SAM Sustainable Water Fund SAM Sustainable Asset Management Unit Trust 25.87 1,189.01
3 Stewardship Investment Funds ICVC - Stewardship International F&C Management, LTD Unit Trust 16.31 261.53
4 Hunter Hall Value Growth Trust Hunter Hall Investment Management, LTD Mutual Fund-Open Ended 14.36 699.19
5 Pioneer Funds - Global Ecology Pioneer Investment Management, LTD (Ireland) Mutual Fund-Open Ended 13.71 949.08
6 Aberdeen Invt. Funds ICVC - Aberdeen Ethical World Fund Aberdeen Asset Managers, LTD (U.K.) Unit Trust 11.88 233.62
7 Pensionskassen for Socialrådgivere og Socialpædagoger PKA Pension (Pensionskassernes Administration A/S) Mutual Fund-Open Ended 7.75 631.71
8 Pictet Funds (Lux) - Clean Energy Fund Pictet & Cie Mutual Fund-Open Ended 7.47 402.86
9 ING Duurzaam Rendement Basis Fonds ING Investment Management Advisors BV Mutual Fund-Open Ended 7.00 491.43
10 Pax World Balanced Fund Pax World Management Corp. Mutual Fund-Open Ended 6.69 971.44
11 New Alternatives Fund Accrued Equities, Inc. Mutual Fund-Open Ended 6.41 162.92
12 Hunter Hall Global Ethical Trust Hunter Hall Investment Management, LTD Mutual Fund-Open Ended 5.56 258.32
13 Credit Suisse Equity Fund (Lux) - Future Energy Credit Suisse Asset Management (Switzerland) Mutual Fund-Open Ended 5.32 186.27
14 St. James's Place Ethical Unit Trust Aberdeen Asset Managers, LTD (U.K.) Unit Trust 4.30 109.86
15 Julius Baer Multipartner SICAV - SAM Sustainable Climat Fund SAM Sustainable Asset Management Mutual Fund-Open Ended 4.05 75.22
16 iShares II Plc - iShares S&P Global Clean Energy Barclays Global Investors (U.K.), LTD ETF 3.87 91.71
17 iShares S&P Global Clean Energy Index Fund Barclays Global Investors N.A. ETF 2.94 70.96
18 Schroder ISF - Global Climate Change Equity Schroder Investment Management (UK), LTD Mutual Fund-Open Ended 2.81 132.62
19 PowerShares Global Clean Energy Portfolio Invesco PowerShares Capital Management, LLC Mutual Fund-Open Ended 2.78 113.76
20 Sjunde AP Premievalsfonden AP 7/Sjunde AP-Fonden Mutual Fund-Open Ended 2.66 215.78
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Top 20 SRI (Social & Environmental) Funds - Brazil
Source: BNYM DRInsight
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SRI (Social & Environmental) Funds Distribution
By region - Global By region - Brazil
Source: BNYM DRInsight
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SRI Approaches – USA and Europe
U.S. and European Investorssimilar goals, but different approaches and tactics
U.S. Europe
Negative screening tradition Triple Bottom Line tradition
Focus on community (1%) Government Promotion of SRI
Activism through Proxy System Engagement with Management
Important to understand focus and approach of each investor
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Review of ESG Practices among Large Emerging Market Companies (March 2009)
40 companies – 4 largest from 10 countriesBrazil: Bradesco, Itau, Petrobras and Vale
Review - Conclusions:
- All companies meet at least some ESG criteria
- Company disclosure on environmental aspects better than on social and governance areas.
- Brazil and Africa do Sul demonstrate superior disclosure than other countries
Emerging Market Disclosure Project
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Brazil demonstrates high disclosure of environmental issues, particularly compared to China, India and Russia
Health and Safety disclosure also strong among Brazilian companies relative to peers
Emerging Market Disclosure Project
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Emerging Market Disclosure Project
Survey of ESG Practices among Large Emerging Market Companies (June 2009)
67 emerging market investors – managing over US$ 130 billion
Survey Conclusions:
- 70% of participants cite lack of ESG disclosure as obstacle to increasing investments
- Brazil cited as country making most progress toward ESG disclosure
- In Brazil, local market initiatives are cited as important to practices –Bovespa’s ISE and Pension Fund Association Guidelines on SRI (Instituo Ethos)
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Emerging Market Disclosure Project
- Brazil most cited as making positive steps toward ESG disclosure
- Itaú Unibanco and Natura earned specific comments:
“Itaú Unibanco provides excellent disclosure of direct and indirect social and environmental risks from banking, including a clear articulation of its activities under the the Equator Principles in line with global best practice standards”
“Natura reflects good disclosure on its systems for managing relations with a disparate agent-based workforce and biodiversity risk management system”