Responsible investment

We consider voting to be an important part of the investment process and have had a formal and considered voting policy since 1994. We have explicitly incorporated corporate responsibility disclosure and performance into our voting since 2001 - being one of the first asset managers to do so globally.

It is only by working with multiple stakeholders that you can deliver a positive impact – be they governments and central banks to charities and customers. Our work to tackle the climate emergency is one of the examples of how we do that.

We believe that accelerating environmental damage from climate, deforestation, ocean pollution, and loss of biodiversity all pose significant risk to economies and the corporate bottom line.

The The World Benchmarking Alliance (WBA) initiative is a great example of what can be achieved when stakeholders across civil society, business, governments and consumers connect their thinking and collaborate together to tackle some of the world’s biggest challenges.

Understanding how economies transition to a sustainable future is more than just an ESG score. Our ESG insights are developed through connected thinking across asset classes: from the macro view to a company profile, and from how we see the world to how we view a sovereign, a sector or a company.

We created the Corporate Human Rights Benchmark in 2013 with a view to use the competitive nature of markets to challenge companies to embed human rights in their organisation. 6 years on the benchmark is widely supported by companies, governments, investors and civil society. This is our update for 2019.

Nearly a third of all natural World Heritage sites are subject to extractive activity, despite protection from the UNESCO World Heritage Convention. Following a number of successful engagements on this topic, including SOCO International and BP, we helped to launch a collaborative project to call on extractive companies to make ‘no go’ commitments in World Heritage sites.

In 2017 Aviva Investors’ Chief Responsible Investment Officer Steve Waygood was invited to become a member of the European Union High-Level Expert Group on Sustainable Finance (HLEG).

A big part of integrating ESG into our investment decisions is making sure that it is embedded across the investment process. Two ways of doing this is our Responsible Investment Officer Network and the integration of ESG into the way investment team members are remunerated.

Responsible Investment and ESG have traditionally been biased towards liquid assets such as equities and bonds. There are several reasons for this, including the weight of assets under management, availability of information, and the rights and access provided to shareholders.

The issues related to antimicrobial resistance and spread of drug-resistant 'superbugs' pose serious risks to public health and the business landscape. We have engaged with our investees to discuss their strategy on antibiotic resistance.

For too long, the investment industry has relied on staid recruitment methods that maintain the status quo. By doing things differently, we can improve diversity and future-proof our businesses, says Apiramy Jeyarajah.

Joana Setzer from the Grantham Research Institute on Climate Change at LSE discusses the implications on governments and companies of the growing wave of climate litigation.

Major listed companies are finding themselves the target of legal action designed to make them move faster towards a lower carbon world. These cases could mark an inflection point; when the conversation turns toward specific responsibilities to move away from fossil fuels rather than broad commitments to change.

Many investors use controversy scores as a filter to avoid firms whose damaging behaviour has hit the headlines, from human rights violations to environmental disasters. But these scores have serious limitations, making them an inadequate tool for investors who want to manage ESG risks and have a positive impact.

The coronavirus epidemic has further accelerated the rise of ESG into the investment mainstream. As deficits skyrocket, bond investors have an opportunity to engage with governments on climate change, argues Thomas Dillon.

There is a growing consensus among companies, governments and electorates across the globe that the world after the pandemic should be greener. But how should we go about this?

Our Head of ESG, Ed Dixon, recently joined Blackstock Consulting on a PropCast episode to launch their new series of ESG insights with industry leaders. Together, they discussed how the government needs to be partnering with businesses to reach their climate pledges, how the “green premium” is yielding higher rents for eco-friendly offices, and much more.

More countries are contemplating their visions for a lower carbon world. Norway has excluded fossil fuels entirely for heating buildings, while others are taking a more nuanced approach. So, what are the options for those with environment at the heart of their agenda?

In 2019, some of the world’s biggest companies pledged to look beyond short-term shareholder value and protect the interests of all stakeholders. The coronavirus pandemic has put these commitments to the test, says Mirza Baig.

Investors are betting the likes of Tesla will win the race for sales of electric vehicles, but traditional carmakers and technology giants may have a say in who passes the chequered flag first.

The UK government says nuclear energy may have a vital role to play in cutting carbon emissions. However, more detail is needed to help investors assess nuclear technology’s ESG credentials, argue Darryl Murphy and Stanley Kwong.

The COVID-19 pandemic has highlighted the importance and fragility of the natural balance. As governments, companies and investors aim for a just transition, sustainable bonds are being issued at pace in different formats. Is it a fad, and do markets really need so many varieties?

Big challenges bring us the opportunity to think differently. Our investment teams reveal what they have learnt from COVID-19, and how they are preparing to face whatever ‘normal’ emerges in a post-pandemic world.

Droughts and water shortages used to be associated with the world’s poorest countries. Now middle-income economies are suffering the effects of extreme weather too, with significant implications for investors, says Will Ballard.

In these data visualisations, we look at whether COVID-19 will achieve something that millions spent on public health campaigning has failed to do.

With traditional carmakers under intense pressure to cut emissions in the fight against climate change, investors are putting their money behind pure play electric vehicle producers. Alessandro Rovelli digs into the numbers to assess whether this trend is sustainable.