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
Grant Hackett has been promoted from CEO of Generation Life to head up the wider Generation Development Group.
Tribeca Investment Partners has made a distribution hire from Australian Ethical in a newly-created role focused on the national intermediary market.
Asset managers may be urged to diversify their product ranges, but investment executives have warned any M&A deal should avoid simply filling gaps and instead consider long-term value creation.
Specialist wealth platform provider Mason Stevens has become the latest target of an acquisition as it enters a binding agreement with a leading Sydney-based private equity firm.
