CFSGAM set to measure ESG impact on portfolios
First State Investments will soon measure the impact of environmental, social and governance (ESG) issues on its portfolios, says global head of responsible investment Will Oulton.
First State Investments is the international arm of Colonial First State Global Asset Management (CFSGAM), the asset management business of the Commonwealth Bank of Australia.
Oulton, who is based in the UK, said he was beginning to see "one or two innovators and leaders in the industry" measuring the impacts of ESG.
"How good is the strength of corporate governance in our portfolios? We don't really know," said Oulton.
"I think our clients will want that information more and more over the coming years. They will want to see: 'What's the environmental impact of that portfolio? What's the carbon intensity of that portfolio?'" he said.
Oulton, who stepped into his role in July last year, says there are three factors which will guide him as the global business implements its responsible investment strategy.
The first is the quality of the institution's investment process and investment outcomes, he said.
"[The second is] our role as steward of our clients' assets and interests. And that's a key thing for us: we have to remember that it's not our money we're managing - it's someone else's," Oulton said.
First State is also a steward of its own brand, which needs to be maintained and protected in the global market, he said.
Finally, the company needs to focus on engagement, Oulton said.
"Not in terms of engaging with companies in our investment process, but engaging with our employees and developing our skills across the organisation," he said.
In the short term, Oulton said he would be creating a global responsible investments committee in the business.
"We have a responsible investment committee that I want to change - I want to make [it] a global responsible investment committee with more senior people on it and representatives across the business," he said.
Recommended for you
Global asset manager Janus Henderson could be acquired after receiving a non-binding acquisition proposal jointly from a private investment firm and venture capital firm.
Investment manager Salter Brothers has partnered with private equity firm Kilara Capital to launch an Australian sustainable investment platform focusing on decarbonisation.
Fresh off launching three active ETFs to the Australian market, Avantis Investors is already planning to expand its range with two further products next year.
Ausbil is growing its active ETF range with an ESG product in collaboration with sister company Candriam.
