Private credit will play a vital role in accelerating the transition to a low-carbon economy.According to Rob Horn, global head of the Blackstone Credit Sustainable Resources Group, this role is set to get a whole lot bigger. Horn believes that credit will eventually supply as much as 60 per cent of the estimated $100 trillion needed to decarbonise economies around the world providing for a particularly attractive investment opportunity for private credit. An opportunity to drive attractive risk-adjusted returns, while potentially improving societal outcomes. In this exclusive fireside chat with Fiona Reynolds, chief executive of Conexus Financial and former head of the UN-supported Principles for Responsible Investment, Horn outlines Blackstone’s view on energy transition as a key investment theme for the firm; its approach to sustainable finance; and what is needed to encourage more institutional investors into this rapidly evolving space.
Divesting from the oil sector has been a boon for La Caisse’s performance, as the Canadian pension giant says its energy investments have earned billions in value-add compared to the benchmark since the inception of its climate strategy. Head of sustainability Bertrand Millot unpacks the fund’s approach in an interview with Top1000funds.com.
Human rights advocate Kerry Kennedy says ESG frameworks are not providing investors with enough reliable data about human rights and other social issues to allow accurate assessment of risks.
GPIF’s Hiro Mizuno and AP2’s Eva Halvarsson stressed the importance of combating short-termism at every level of the investment chain and throughout the organisation, to forge sustainability.
Mission 2020 convenor Christiana Figueres challenged PRI signatories to invest 1 per cent of assets in clean technology and renewable energy by 2020, saying the world is nearly out of time.
When fund trustees and internal environmental, social and governance staff have an open, collaborative relationship, information flows more efficiently and difficult issues can be addressed.
The largest fund in the US, the California Public Employees’ Retirement System, the largest fund in Europe, ABP, and a fast-growing Australian fund, Cbus Super, have all adopted the SDGs.
There is momentum on the continent towards a sustainable financial system but a short-term economy persists. Stakeholders think the classic metrics of success may need to change.
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