BTIM seeks ESG credit reporting
Monday, 17 November 2008 12:10pm
BT Investment Management's multi strategies team wants to broaden its analysis to cover each company's entire capital structure and extend its ethical fund's investment universe to investment grade credit.
Robert Swift, BT Investment Management head of multi strategies, said the team is looking to add investment grade credit to the investment mix of its balanced ethical fund, but needs to improve its environmental, social and governance (ESG) reporting analysis.
The balanced ethical fund is currently invested 25 per cent in cash and equities and the remaining half to Australian government bonds, Swift said.
"If we were able to have a fund that is more balanced between equities and bonds, that were themselves had an ESG score, we could offer our clients a lot more holistic approach to SRI based investing," he said.
"This allows investors to be more diversified, if we want to run an equity portfolio which is SRI compliant, an investor is still going to get a lot of equity risk."
Rajinder Singh, BT Investment Management multi strategies portfolio manager, said the firm cannot invest in investment grade credit because it lacks the level of required ESG screening.
BT Investment Management use Regnan to assess and screen for ESG risk in its underlying portfolios. Swift said the firm would work with Regnan to extend the analysis to investment grade credit.
"There are difficulties, debt markets have become more global so it's an issue in terms of coverage and how we assess the international issuers but it's a logical extension," said Singh.
Michael Hobbs
