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New IRI Report Identifies Investor Expectations for Publicly Traded Energy

By Erin Shackelford

Investor Expectations on the Just Transition: Publicly Traded Energy

 

 

 

 

 

What questions should investors ask about energy investments today? What risks are present in the energy sector as the demand for a greener and more just world grows? A new IRI report authored by David Wood and Vonda Brunsting, Investor Expectations on the Just Transition: Publicly Traded Energy, summarizes research by the IRI, in collaboration with the ICCR, which identifies key concerns and expectations of investors. Drawing on research which culminated in a December, 2019 convening at the Harvard Kennedy School that brought together publicly traded utilities, shareholders, labor representatives, and environmental activists to work towards better understanding of the role investors can play in moving utilities towards a more just and green energy system, this report is a useful brief for investors and publicly traded utilities.

Roles Foundations Play in Shaping Impact Investing

by David Wood

Thanks to Megan Kashner and the Impact and Sustainable Finance Faculty Consortium, I had the chance to write a short piece on the relationship of foundations to impact investing now online at the Stanford Social Innovation Review. It’s a topic I’ve been thinking about for awhile, at least since the formation of the More for Mission Campaign in the mid-2000s – how foundations try to change finance because it’s socially suboptimal, and try to influence investment because it’s socially powerful. It’s one manifestation of what I think of as an essential tension in the field. Practitioners have to hold in their heads two propositions to engage with impact investing: finance can fix things, and we need to fix finance.... Read more about Roles Foundations Play in Shaping Impact Investing

TLF Annual Convening Postponed Indefinately

Due to the ongoing COVID-19 health emergency, the IRI must postpone the TLF Annual Convening scheduled for June 8 – 10, 2020. We hope to offer some helpful virtual discussions in the coming weeks and months, to act as a clearinghouse for information for our TLF community in this challenging time, and, when it is appropriate, to come together again in person at the Harvard Kennedy School. In the meantime, please keep in touch.

Responsible Investment and the Labor Question

by Erin Shackelford

In a new long read in Responsible Investor, IRI Director David Wood joins Mike Musaraca in exploring the adequacy of RI to address issues of labor, income inequality, and financialization.  "In theory," they write, "the RI community was created to allow investors to address major social issues left out of conventional financial practice. But for RI to tackle what Joshua Freeman refers to . . . as the labor question, it has to go beyond its own conventional toolkit, to address the political economy that structures economic inequality, the system that allows for investment decision-making to take place. ESG is not enough to tackle the labor question."  Read the article "Responsible Investment and the Labor Question" on Responsible Investor [paywall].

New Guidance on The Just Transition

The IRI and the Grantham Research Institute on Climate Change and the Environment at the London School of Economics have issued a new report, Climate Change and the Just Transition: A Guide for Investor Action. The report is accompanied by an investor statement, which has attracted the support of more than 100 institutions with over $5 trillion in assets under management (AUM).

Coinciding with the COP 24 Climate Conference in Katowice, Poland, the UN's Principles of Responsible Investment (PRI) and International Trade Union Confederation (ITUC) highlighted the critical role investors can play in fostering a dynamic and inclusive economy within climate change adaptation – a just transition. The report, intended to provide actionable steps toward this transition, was delivered in partnership with the Principles for Responsible Investment and the International Trade Union Confederation.

... Read more about New Guidance on The Just Transition

Financing the transition: how investors can help make climate action inclusive

This post is a republication of a blog post of our partner, the Grantham Research Institute on Climate Change and the Environment at LSE, original here.

JT blog

It is becoming ever clearer that action on climate change is not just environmentally essential but also provides one of the best strategies for delivering positive economic and social development. According to the latest report from the New Climate Economy (NCE), ambitious climate action could produce a direct economic gain of US$26 trillion through to 2030 compared with business-as-usual, along with a net employment gain of 37 million jobs. But it is also obvious that these benefits will not flow automatically or equitably. As well as rapidly reallocating capital from high- to low-carbon assets, we need to make sure that, in the NCE’s words, “the gains are shared equitably and the transition is just”.... Read more about Financing the transition: how investors can help make climate action inclusive

New IRI Report Examines National Advisory Boards on Impact Investing

by Erin Shackelford

The Initiative for Responsible Investment is pleased to announce the release of a new report by IRI Director Dr. David Wood and former IRI Assistant Director Katie Grace Deane (now at the Center for Community Investment) with the support of the MacArthur Foundation.  The report “National Advisory Boards and Impact Investing:  The Power of Cross-Sector Collaboration”, stems from work with the Global Steering Group for Impact Investing (GSG), the successor organization to the Social Impact Investing Taskforce of the G8.  Our new report illuminates the work of National Advisory Boards (NABs) on Impact Investing.... Read more about New IRI Report Examines National Advisory Boards on Impact Investing

HKS Student-Led Impact Investing Study Group Features Impressive Guest Speakers

One of the roles of the IRI is to connect different stakeholders in the responsible investing community, and this year we’ve been excited to work with Harvard Kennedy School (HKS) students who are leading the  Impact Investing Study Group (IISG).

An initiative between IRI Director David Wood and HKS MPA students John Griffith and Anubha Shrivastava, the IISG is comprised of around 70 students across HKS, HBS, HLS and GSD with some professional and/or academic background in impact investing. Throughout the year, the IISG has  convened a series of roundtable...

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Collaboration by Design: CDFIs, Capital Absorption, and the Creation of Community Investment Systems

by Erin Shackelford

Rebuilding disinvested communities takes more than money. Rather, as research done by the Initiative for Responsible Investment (IRI) at the Harvard Kennedy School has shown, places that have been starved of resources for extended periods of time often lack the policies, practices, or relationships they need to effectively leverage existing or new resources.

IRI's capital absorption framework not only recognizes that there is a complex system that governs how resources flow into communities, it also provides a way to think beyond individual transactions to identify changes at a system level so that investment is used more effectively to achieve community goals. Potential system-level interventions can include bringing new partners to the table, identifying new resources that can be provided by existing partners, creating different ways of doing business, and changing the policies and relationships that determine the allocation of money and other resources.

Many of these approaches are central to strategies used in collaborative initiatives carried out by Community Development Financial Institutions (CDFIs) that have been funded by JPMorgan Chase & Co.'s PRO Neighborhoods program. The growing collaboration among CDFIs—which can be banks, credit unions, or other financial institutions that have a primary mission to provide access to financial services in low-income communities—have included the development of joint products and services, efforts to share risk and expertise, jointly developed new technologies, and the development of larger scale projects which could attract additional investors.

A new case study, which uses this "capital absorption" framework to examine many of the collaborative efforts funded by the PRO Neighborhoods initiative, finds that the funding spurred three types of collaborations that together increased the CDFIs' ability to respond more effectively to key needs and concerns.... Read more about Collaboration by Design: CDFIs, Capital Absorption, and the Creation of Community Investment Systems

Investing in “High Road” Infrastructure

by Erin Shackelford

bridge

In light of the recent White House proposal on infrastructure, now may be a good time for investors to consider what makes infrastructure investment responsible, or “high road”.  The current proposal is reportedly focused on incentivizing private sector investment in infrastructure, rather than providing a large federal spending package or a revenue producing proposal, like increasing the gas tax.  With this framework, investors may see an uptick in infrastructure fund-raising.  Indeed, investors may have an opportunity at this moment to signal what kinds of infrastructure investments they consider investable.  Two recent publications may be helpful to those considering investments that both meet their long-term risk-return profile, and properly include consideration of relevant ESG factors and collateral community benefits.... Read more about Investing in “High Road” Infrastructure