Federated Hermes launches impact database
Federated Hermes has launched its Impact Database to help report to clients on the overall impact of the Federated Hermes Impact Opportunities Fund’s assets under management (AUM) and the impact of individual holdings.
The impact and sustainable investing team at the firm were responsible for the database which would assess the impact of companies.
It had two important objectives:
- Portfolio managers could trace and account for each investment, providing a means through which they could monitor a company and ensure its impact intentionality as a business; and
- To provide clients with a quantifiable indication of how their capital allocation was helping achieve positive impact, as aligned to the 17 UN Sustainable Development Goals.
The team selected 20 impact metrics, which had been grouped into 11 relevant themes.
Each theme contained either (or both) an operations-based metric relating to a company’s operations or a solutions-based metric relating to the specific outcomes a company was looking to provide.
According to the database, in 2019, the capital deployed in the Federated Hermes Impact Opportunities Fund achieved the following outcomes:
- 33,400 MWH of clean energy generated;
- 1,100 tonnes of waste was recycled plus a further 201 tonnes through recycling programs in operations;
- Avoided 3,600 MT of food waste;
- Financial access was given to 4,700 people;
- 153,000 patients were treated and 7k lives were extended; and
- 2.5 hectares of forest were protected;
Ingrid Kukuljan, Federated Hermes head of impact and sustainable investing, said after looking at the tools available in the market to analyse impact data, they did not believe that any one provider had the depth of understanding and granularity the firm required at a company level.
“It is imperative that all investee companies generate a positive impact that can be measured quantitatively, as well as qualitatively,” Kukuljan said.
“We have put a significant amount of time and resource into producing the database and it has yielded extremely valuable results.
“Not only can we clearly demonstrate to clients the real impact of our investments, but also use it as a framework to assess companies on our watchlist.”
AUTHOR
Chris Dastoor
Recommended for you
Some 42 per cent of CEOs say they are actively reinventing their business to stay relevant in the next decade, with consumer services the most common choice for asset and wealth managers.
Former Ophir Asset Management chief executive, George Chirakis, has joined private equity manager Scarcity Partners, while the asset manager has appointed a replacement from Macquarie.
Australian Unity has appointed a fund manager for its Healthcare Property Trust, joining from Centuria Healthcare, as it restructures the product with a series of senior appointments.
Financial advisers nervous about the liquidity of private markets funds for their retail clients are the target of fund managers launching semi-liquid products which offer greater flexibility and redemptions.
