In Brief

Equileap launches women in tech index

Collaborating with Indxx to track technology companies improving on gender equality

Equileap, the gender data provider, and Indxx, have partnered to launch a women in technology index in the US.

The Indxx Equileap US Women in Technology Index will track the performance of technology companies in the US that are making the most improvement in terms of gender representation throughout their whole corporations.

Currently topping the index are Texas Instruments, International Business Machine and Lam Research. Companies are drawn from the Indxx Technology Sector Index and then selected based on liquidity criteria and gender scores provided by Equileap. These scores are based on 19 criteria across four categories: gender balance in leadership and workforce; equal compensation and work/life balance; policies promoting gender equality, commitment, transparency and accountability. In addition, any companies with incidents of gender discrimination or sexual harassment that have triggered legal judgements or rulings are excluded from the index.

Investing in companies that prioritise gender equality and diversity has become increasingly important, not only from a moral standpoint but also from a financial perspective. Companies with more gender equality and women in leadership positions tend to receive higher ESG scores and therefore receive more investments from ESG funds.

“The back-tested over-performance of the Indxx Equileap US Women in Technology Index of 5% over the past five years against the Indxx 500 Index adds further weight to the evidence that better gender equality leads to higher performance even in a sector where, for the most part, women are underrepresented,” said Diana van Maasdijk, CEO of Equileap.

Rahul Sen Sharma, president and co-CEO of Indxx, added: “The consequences of a lack of diversity can be far-reaching, hindering innovation, and limiting an industry’s potential to tackle complex challenges. Our partnership with Equileap allows us to…create unique opportunities within our indexing ecosystem by providing exposure to companies that are leading in terms of gender equality.” 

AllianceBernstein and Columbia Climate School update investor natural disaster risk tool

Natural Hazards Index 2.0 ranks up to 14 risks

AllianceBernstein (AB) has teamed up with the National Center for Disaster Preparedness at the Columbia Climate School (NCDP) to launch the updated version of a climate hazard risk toolkit for US investors.

The Natural Hazards Index 2.0 is a free online dashboard tool that shows the risks of 14 different natural disasters materializing in any given city in the US including Puerto Rico.

Unlike most hazard maps, which focus on a single disaster, the Natural Hazards Index analyzes up to 14 hazards and ranks their risk from low, very low, moderate, high to very high, scoring them from one to five. The heat map uses publicly available hazard data; its map application explains each data source, the value interpretation as well as layer sources, indicators and geographic coverage.

Climate change presents material investment risks, as well as opportunities, for wealth managers and is increasingly seen as a financial risk. The US alone has battled 348 weather and climate disasters since 1980 where overall damages and costs reached or exceeded $1bn, according to the National Centres for Environmental Information, costing $2.51trn.

AB first backed the Columbia Climate School – thought to be the first purpose-built school in the world to focus exclusively on tackling climate change – in April 2021 when it became a founding member of the corporate affiliate programme associated with the school.

John Huang, director of ESG data and technology at AB, said: “The Columbia Climate School continues to be a critical partner in supporting our investment teams’ efforts to integrate material climate factors into the investment process, where applicable. 

“This innovative tool represents AB’s differentiated approach to partnership and data, layering on our internal insights as an active manager when it comes to understanding the potential impact of climate change on asset values and cash flows.”

Jonathan Sury, senior staff associate and project lead at NCDP, added: “Since the launch of version 1.0 of this map, we have been impressed with its utility and depth of reach across many sectors and communities. Through this partnership, we are thrilled to be releasing this major upgrade. 

“We have thoughtfully curated the most current publicly available hazard data and compiled them into an easy-to-understand format, taking the guesswork out of navigating complex data from multiple sources.”

Biden vetoes anti-ESG bill

Says legislation passed by Congress puts retirement savings at risk

US president Joe Biden has used his first presidential veto to reject a bill passed in the Senate that would block the Department of Labor (DOL)’s ESG rule for retirement plans.

Reuters reported that in a video posted on Monday to Twitter, Biden said: “I just signed this veto because the legislation passed by the Congress would put at risk the retirement savings of individuals across the country.”

The DOL’s rule allows plan fiduciaries to consider ESG factors when selecting investments. The measure replaced a Trump administration rule that critics said would have had a chilling effect on the use of ESG in retirement accounts.

Earlier this month the Senate has voted 50-46 to block the rule, with the Senators introducing their bill casting it as “politiciz[ing] millions of Americans’ retirement investments to favor Biden’s ideological preferences rather than getting the best returns for Americans.”

Commenting on the presidential veto, non-profit JUST Capital said it was a shame ESG had become political football.

“ESG has become politicized, but the truth is it was never about politics, and for many in the industry, it still isn’t. It’s about smarter investing and better business,” it said in a statement.

“When asked specifically about ESG regulation in our recent focus groups, most respondents, regardless of political affiliation, said they prefer to let financial service providers use their expertise to make decisions when it comes to what factors to evaluate and where to make investments.” 

MSCI to incorporate biodiversity data through NatureAlpha partnership

Clients will be able to better identify nature risks and ensure alignment with Global Biodiversity Framework

MSCI is set to distribute biodiversity data and analytical tools from NatureAlpha, an AI and data-driven platform providing specialist insights into nature footprints and risks.

This, MSCI said, will help its clients better identify their exposure to higher-impact companies from a biodiversity risk perspective, better align companies’ activities with the Global Biodiversity Framework and provide enhanced reporting in line with the Taskforce on Nature-related Financial Disclosures (TNFD) as it evolves.

Vian Sharif, founder of NatureAlpha, commented: “Our collaboration with MSCI comes at a crucial moment for biodiversity and nature with investors driving demand for data which asset managers can integrate into workflows.”

Last December at COP15 in Montreal leaders agreed the Global Biodiversity Framework, which Sharif said has provided an important tailwind to conversations regarding the role the investment community can play in protecting nature and biodiversity and how related material risks can be measured.

“With over half of the world’s GDP dependent on nature,” Sharif continued, “financial exposure to risks from nature loss is significant and accountability is greater than ever. We are proud to work with such an established and credible collaborator and look forward to enhancing our methodologies to provide biodiversity impact and nature risk solutions for the corporate universe at scale.”

Arne Klug, vice president and biodiversity research director at MSCI ESG Research, said: “The investment community is becoming increasingly aware of how nature loss is a major threat to the global economy. Global biodiversity challenges have tangible impacts on the ways in which companies across industries function now and in the future. Therefore, investor demand for advanced data and tools to address biodiversity risks and impact is growing. MSCI’s collaboration with NatureAlpha will help our clients better identify and assess impacts and risks from nature loss in their portfolios.”

Last month, NatureAlpha launched the Integrated Biodiversity Assessment Tool (IBAT) to its platform providing biodiversity and nature metrics to help them understand portfolio-related risks. IBAT was formed by NatureAlpha’s collaboration with the United Nations Environment Programme – World Conservation Monitoring Centre, the International Union for Conservation of Nature (IUCN), BirdLife International and Conservation International.

abrdn mining engagement leads to health and safety recommendations

Following reports of sexual harassment, racism, sexism and bullying

abrdn has recommended mining companies expand their health and safety mechanisms to protect the wellbeing of employees following incidents of sexual harassment and assault.

In April last year, the investment manager joined UK investment firm Sarasin & Partners in abstaining from approving Rio Tinto’s reports and accounts in light of the Broderick Report, which found systemic issues of bullying, sexual harassment, sexism and racism at the mining giant.

“If we do not see progress against the milestones set by the company, we will take further actions,” abrdn head of active ownership Andrew Mason said at the time.

Following engagement with some of its largest mining holdings, abrdn released a statement recommending these companies expand their health and safety mechanisms, including governance oversight, plus links to remuneration and monitoring and reporting to assure the psychological wellbeing of employees.

“Mining companies should use all the tools they have available to them,” Mason said.

“Many mining companies have demonstrated a strong track-record in improving health and safety, embedding aspects into all areas of their organizational cultures and business processes. Employees’ psychological wellbeing warrants a similar approach.”

The statement has been endorsed by the International Council on Mining and Metals (ICMM), which updated its mining principles last year. “Discrimination, harassment, and assault of any kind have no place in the mining industry or anywhere else in society. We recognize that the change starts with us,” ICMM president and CEO Rohitesh Dhawan said.

abrdn’s engagement has also been endorsed by mining CEOs at Anglo American, AngloGold Ashanti, BHP, Codelco, Gold Fields, OZ Minerals, Rio Tinto, South32 and Vale.

JP Morgan firm buys $500m in land, partly for carbon capture

The purchase includes 250,000 acres in the Southeast

A timber investment firm owned by JP Morgan recently bought more than 250,000 acres of forest land on behalf of institutional investors, the company announced this week.

The land, which Campbell Global values at more than $500m, will be used for timber harvesting but also carbon capture, the firms said.

The forest land is “high-quality, commercial timberland across three properties in the Southeastern US,” according to the announcement.

“This transaction is one of the largest of its type in the past decade and builds on efforts to expand our asset class offering across alternatives by offering investors access to a robust carbon sequestration and timber management platform,” Anton Pil, global head of JP Morgan Global Alternatives, said in the announcement. “We are committed to harnessing the extensive forest management expertise of Campbell Global to offer our clients the unique ESG benefits associated with timberland assets.”

The three pieces of land represent 18 million metric tons of stored carbon dioxide equivalents, the firms stated.

JP Morgan acquired Campbell Global in 2021.

Last year, JP Morgan participated in Series B funding totaling $50m for carbon credit marketplace NCX, which works with small-scale land owners to delay cutting trees in exchange for compensation.

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