• Home
  • Admin/Tech
  • Benefits
  • Buzz
  • DB
  • DC
  • Diversity
  • Investment
  • Law & regulation
  • Risk reduction
  • Events
  • Whitepapers
  • Spotlights
  • Digital Edition
  • PPTV
  • Newsletters
  • Sign in
  •  
      • Newsletters
      • Account details
      • Contact support
      • Sign out
     
    •  

      You are currently accessing ProfessionalPensions via your Enterprise account.

      If you already have an account please use the link below to sign in.

      If you have any problems with your access or would like to request an individual access account please contact our customer service team.

      Phone: +44 (0) 1858 438800

      Email: [email protected]

      • Sign in
  • Follow us
    • Twitter
    • LinkedIn
    • Newsletters
    • YouTube
  • Register
  • Subscribe
  • Events
    • Upcoming events
      event logo
      Defined Benefit Consolidation Conference

      Professional Pensions is hosting this concise digital event on the 25th March to provide a crucial update on where the current regulation stands on DB Consolidators, assess the different models available, what the expected funding levels are and the governance requirements. This event will be a combination of short presentations followed by live Q&A’s with our expert speakers allowing plenty of time to answer your questions.

      • Date: 25 Mar 2021
      • Digital Conference
      event logo
      Defined Contribution Conference

      Professional Pensions Defined Contribution virtual event, hopes to take stock of the last year, and ask the important questions; are members saving enough and have we improved the member journey at retirement? This two part digital event will provide you with the latest thinking and innovation in the DC market during our snappy 15 minute presentations, with plenty of time to ask questions during our live speaker Q&A.

      • Date: 20 Apr 2021
      • Digital Conference
      event logo
      Sustainable Investment Festival 2021

      The Sustainable Investment Festival will run online from 22-25 June and will include thought-provoking presentations from renowned keynote speakers, innovative breakout events and sessions specifically tailored to meet the information needs of fund selectors, financial advisers, pension consultants, trustees and scheme managers.

      • Date: 22 Jun 2021
      • Online, Online
      event logo
      UK Pensions Awards 2021

      The UK Pensions Awards – now in their 24th year – remain the industry's most prestigious accolades. They shine the light on excellence and recognise the advisers, providers and investment managers that offer the highest level of innovation, performance and service to occupational pension schemes and their members, and have done the most to improve this over the past year.

      • Date: 14 Sep 2021
      • London
      View all events
      Follow our Professional Pension Events

      Sign up to receive email alerts about our events

      Sign up

  • Whitepapers
    • How DC schemes can gain exposure to different asset classes in a low-return environment

      So far, DC plans have largely been focused on the onset of auto-enrolment and changes to the regulatory framework - be it the ‘charge cap,' ‘pension freedoms' or consultations around ‘value for money', says Annabel Tonry, Executive Director at J.P. Morgan Asset Management (JPMAM).

      Download
      Pension freedoms three years on

      In 2015 George Osborne, then the UK Chancellor of the Exchequer, decided that those age over 55 could take much more of their pension in cash. This has since opened up a range of possibilities for DC scheme members in the world of pensions.

      Download
      Find whitepapers
      Search by title or subject area
      View all whitepapers
  • Spotlights
  • Digital Edition
Professional Pensions
Professional Pensions
Sponsored by T. Rowe Price
  • Home
  • Admin/Tech
  • Benefits
  • Buzz
  • DB
  • DC
  • Diversity
  • Investment
  • Law & regulation
  • Risk reduction
 
    • Newsletters
    • Account details
    • Contact support
    • Sign out
 
  •  

    You are currently accessing ProfessionalPensions via your Enterprise account.

    If you already have an account please use the link below to sign in.

    If you have any problems with your access or would like to request an individual access account please contact our customer service team.

    Phone: +44 (0) 1858 438800

    Email: [email protected]

    • Sign in
 
  • Investment

DC: A sustainable future?

  • Julian Lyne
  • 09 May 2018
  • Tweet  
  • Facebook  
  • LinkedIn  
  • Send to  
0 Comments

Newton Investment Management's series of DC columns continues with Julian Lyne discussing how the industry meets the demand for SRI

Interest in sustainability has increased hugely over the recent past in the US, with sustainable investing seeing 135% growth from 2012-2016, according to the US SIF Foundation1. Much of the focus has been driven by large public-sector DB plans, as well as by the endowments and foundations sector. 

Increasingly, however, people are making the connection between the increasing importance of the millennial 401k DC population, and the fund choices on offer. Rightly or wrongly, commentators are contrasting the investment beliefs of the various generations that make up the DC population, and postulating whether more account needs to be taken of these differing investment views.

At the nub of the argument is the belief that millennials, more than other generations, wish to see the companies they invest in behave in a more sustainable fashion. According to research conducted by Morgan Stanley, 86% of millennials (broadly defined as those born between the early 1980s and 2000) say they are interested in socially responsible investing. Millennials are also twice as likely to invest in a stock or a fund if social responsibility is part of the value-creation thesis2. According to the Schroders Global Investor Study 2016, which surveyed 20,000 end investors in 28 countries, the millennial generation ranked ESG factors as equally important as investment outcomes when considering investment decisions3.  

Although the reality of these generational differences is debateable, there is no doubt that the fund management industry has responded with a surge of new investment products. However, in a recent Callan DC survey, only three out of 17 corporate DC plans offered funds in which environmental, social and governance (ESG) factors were included4, so there seems to be a disconnect somewhere.

One reason could be the range of ‘responsible' investments available. From screened socially responsible investment (SRI) funds to integrated approaches and branded sustainable funds, the choice is widespread. This reflects that there is a wide definition of what ESG and responsible investing means, and not everyone has the same investment objective. Indeed, at Newton, our clients invest in all three approaches.

The reasons why DC investors are considering ESG options are varied. It could be that they do not want to hear of a stock they own in their plan being responsible for polluting, or having issues with corruption or slave labour in its supply chain. It could be a belief that companies that consider ESG factors will in the long term outperform those that don't, which is ultimately a belief in better long-term performance (and some might argue better risk management too). Where the latter is the case, ESG-related investing will prove attractive for all cohorts and not just the millennial generation.

Julian Lyne is chief commercial officer at Newton Investment Management

For more information please contact: Catherine Doyle, head of DC UK, Newton Investment Management, [email protected]

1 Source: Report on US Sustainable, Responsible and Impact Investing Trends, US SIF Foundation, November 2016
2 https://www.morganstanley.com/ideas/millennial-sustainable-investing
3 http://www.schroders.com/en/media-relations/newsroom/all_news_releases/schroders-global-investor-study-2016-millennials-put-greater-importance-on-esg-factors/
4 http://www.pionline.com/article/20180205/PRINT/180209917/dc-participants-seen-as-next-advocates-of-esg-mantra

Important information: This is a financial promotion. This article is for professional investors only. These opinions should not be construed as investment or any other advice and are subject to change. This document is for information purposes only. Any reference to a specific security, country or sector should not be construed as a recommendation to buy or sell investments in those countries or sectors. Issued in the UK by Newton Investment Management Limited, The Bank of New York Mellon Centre, 160 Queen Victoria Street, London, EC4V 4LA. Registered in England No. 01371973. Newton Investment Management is authorised and regulated by the Financial Conduct Authority.

  • Tweet  
  • Facebook  
  • LinkedIn  
  • Send to  
  • Topics
  • Investment
  • Defined Contribution
  • Industry Voice
  • Newton
  • Newton Investment Management
blog comments powered by Disqus
Back to Top
Trustpilot

 

  • Contact Us
  • Marketing solutions
  • About Incisive Media
  • Terms and conditions
  • Policies
  • Careers
  • Twitter
  • LinkedIn
  • Newsletters
  • YouTube

© Incisive Business Media (IP) Limited, Published by Incisive Business Media Limited, New London House, 172 Drury Lane, London WC2B 5QR, registered in England and Wales with company registration numbers 09177174 & 09178013

Digital publisher of the year
Digital publisher of the year 2010, 2013, 2016 & 2017
Loading