Facebook icon Twitter icon Forward icon

Welcome to 'inSRI' Newsletter 9!

This rather late, 'late spring' newsletter is to update you on some of the key issues in retail SRI since the start of the year.

This note does not attempt to be a complete record of sector progress as innovation and expansion have been constant features of this area over the last couple of years.

Instead, I have focused on areas that relate directly to large numbers of retail investors and the shifting dynamics that form the backdrop to sustainable, responsible and ethical investment  today. 

By means of 'Executive summary' - my overriding sentiment recently has been  ‘wow’, with perhaps a dash of 'about time too' and crossed fingers!

I hope you find this useful!  And as ever, you are welcome to contact me on julia@sriServices.co.uk.

Fund EcoMarket IT upgrade

In late Q1 we appointed a new IT service provider for Fund EcoMarket - their new bigger team have enabled us to make many great changes - and there is more yet to come (including a new newsletter format).  The key (visible) changes so far include:

  • A new 'Help' area (tool bar) .  This includes explanatory text such as our recently updated SRI Styles Directory and adviser support pages.
  • A new Investment filter to split 'Geographic region' and 'Asset types' - to make SRI portfolio planning easier. 
  • Improved sponsor visibility - as without these companies this free to use resource would not exist. (The site remains 'whole of market' for regulated, retail, screened and themed funds of course - plus numerous additional options.)

(Fund Manager note - Fund specific listings information should be sent to Su on srifund.fem@gmail.com.)

Fund EcoMarket fund updates

Fund EcoMarket is updated quarterly to ensure fund listings are as up to date as is sensibly possible.

  • A notable change this quarter has been the Sustainable Futures team moving to Liontrust - from Alliance Trust Investment. This has been widely welcomed as being beneficial for all concerned.  (We are in the process of updating their fund entries on Fund EcoMarket.)

We are also in the processing of reviewing all of the fund specific research held within the filters, text and links in the 'More Info' boxes on Fund EcoMarket. 

  • When the updated entries go live they will show some new 'SRI Policy' and 'SRI Features' options - which have been added to help users keep up to date with market changes.

International SRI & ESG Growth

A welcome report by the Global Sustainable Investment Alliance shows mega growth in this area across the world, indicating that many of the issues that sustainable, responsible and ethical investors care about are now taken seriously by a significant proportion of the world's largest investors.

Interestingly the research indicated that 'negative screening' and 'ESG integration' are the two most popular strategies. 

These areas are referred to as 'Negative Ethical' and 'ESG Integration' within our SRI Styles filter option on Fund EcoMarket  - although we would also encourage users to look at 'Ethically Balanced' and 'Sustainability Themed' options as they are closely related in the UK retail market.

Some thoughts (via my blog) and a link to the report is  available here.

Additional reports and literature links can also be found on the SRI Services literature directory (and linked pages.)

'DC Pension Schemes and Social Investment' consultation

The Law Commission issued a consultation  on 'DC Pension Schemes and Social Investment' in late 2016.  

This was due to report around now, but has been delayed because of purdah.  We expect to see their response shortly after June 8.

This consultation is particularly important as it includes numerous references to screened and themed SRI and ethical funds - and is therefore likely to impact future growth in the retail SRI pensions market. (Fund managers may therefore like to consider the  accessibility of their funds via such options!)

A link to my brief blog on this topic - and the publicly available consultations responses - are available here.


DB Pension Schemes and SRI - new guidance

Following consultation, The Pensions Regulator (TPR) has issued guidance to Trustees of DB pension schemes - who are now (almost) obligated to consider SRI and ESG issues.

Recent guidance indicates, in brief, the need to consider sustainability, climate change and ethical values - when trustees feel such issues may be relevant.

To my mind, schemes trustees (and their advisers) would have to be stunningly foolhardy to overlook such areas now, not least because this would leave them exposed in the event of future member criticism.

To read my blog on this topic - and relevant links see here.

This builds on TPR Investment Governance Guidance for trustees issued in 2016.

Professional body directs pension actuaries to consider climate

The Chair of the Environment and Resource Board at the Institute and Faculty of Actuaries, Nico Aspinell, presented at a Transparency symposium last week, indicating that all UK pension actuaries have received correspondence instructing them to consider climate risk.  The letter apparently explains that climate change is as a potential risk over the lifetime of pension schemes.  (The letter has recently been issued. We hope to receive a copy soon.)

The work carried out by the Institute of Actuaries concurs with the messages conveyed by environmental lawyers Client Earth - and factors identified in UKSIF's 'Understanding and applying fiduciary duty' Ownership Day guide.

For further information on climate risk and financial stability you may like to see the TCFD Mark Carney video referred to as 'The tragedy of the horizons' .  A link is available on the new  'Further Reading' area of Fund EcoMarket.

New filter options on Fund EcoMarket research tool

Fund EcoMarket now has eight 'retail sustainable, responsible and ethical investment' filter and search options:

•Fund name
•Product type
Asset type
•Geographic region

•SRI Style
•SRI Fund Policies
•SRI Fund Features
•Corporate SRI Activity

The SRI Styles option relates to our unique online 'SRI StyleFinder' fact find questionnaire which generates a report showing 'best fit' SRI Styles. Fund reports can also be generated for audit trail and record keeping purposes.

Fund EcoMarket is free to use thanks to the support of Rathbones, Pictet, Sarasin & Partners, Quilter Cheviot, Unicorn, Liontrust and Triodos who share our aim of raising awareness of this important area.

You can check out their funds on www.FundEcoMarket.co.uk by clicking the logos in the tool header area.

European Commission 'retail products' PRIIPS consultation

'Packaged retail investment products' look set to be required to give explanations of their 'environmental or social' (EOS) screened and themed fund options where applicable - under EU law, from 1 January 2018.

The consultation appears likely to require 'EOS' strategies to be explained in KIDs and in Investment Policy Statements - and there may also be additional governance requirements on the way. 

Although I am far from being an expert in EU law the outcome of this is clearly likely to be significant for the retail investment market.  

You can see my blog and links to the consultation paper here.

(Note - recent press articles indicate that DFMs may be exempt from these rules. )


Technology permitting I will shortly be adding an 'Events' area to Fund EcoMarket.

My plan is to run the following over the coming months.

  • Telephone conferences to help advisers, paraplanners, researchers and others to understand how to use Fund EcoMarket  to best effect.
  • A fourth annual Good Money Week event (in October) - along the lines of last year's sell out 'Screened, Themed and Engaged' London event.

If you would like to be added to our list for either of these please contact me on julia@sriServices.co.uk  . 

Please let me know what information you would most like to hear about - as this will help shape the agenda. 

You may also be aware that I ran my first CISI event in January this year, and am now on their speaker register.  If you are involved with a CISI group you may like to suggest that I present at a training day, as I will be delighted to do so - diaries permitting!

And finally...

Much activity takes place behind the scenes to help make Fund EcoMarket as useful as possible (including responding to seemingly endless consultations!).  

Although this site is 'open to all' our core intended audience is financial advisers - and related financial services professionals.  The information we publish is for information only.  We are not regulated, do not offer advice and do not deal with members of the public.

Our aim is to help support the SRI advice process by simplifying it where possible - and also by ensuring detailed, fund specific, easily comparable supporting information is available.

In return we would like to ask you to help spread the word about what we do on www.FundEcoMarket.co.uk  as it can only help change the way people invest if industry professionals get to hear about it!  So please feel free to encourage your colleagues, support teams and other professional contacts to get in touch or  to  sign up to 'inSRI'!  

Best wishes to all,

Julia Dreblow

Founder sriServices & Fund EcoMarket

(PS and phew... I have somehow managed to avoid mentioning  Brexit and Trump until now - so am feeling somewhat pleased!)