3. Who We Are: Sustainable Investment Architects
• SinCo at a Glance • Experienced
– Bespoke investment advisory focused – Established boutique in Boston in Q4
on sustainable investment architecture 2006 : Inaugural engagement for
– Architect + 2 analysts with support Wall St proprietary and third party
team operating projects with partners manager with USD 900bn AUM, 200
in Geneva, Seattle, London, Nairobi, analysts, mutli-asset classes
Washington DC, Cape Town, Istanbul – Sabbatical to establish PRI in
– Word-of-mouth, below-the-radar Emerging Markets Project for UN
approach Environment Programme Finance
Initiative 2007/8: Ramped
membership in EM 57%
• Philosophy – Since 2006, SinCo has delivered
– SinCo is a boutique investment advisory sustainable investment architecture
firm specializing as an ESG investment globally to pension funds, asset
architect for sustainable investment in managers and international
frontier and emerging markets. organizations integrating ESG
– SinCo offer the domain knowledge and factors into investment practice.
global experience to help investors
understand the threats and
opportunities of the sustainability meta- • Proven Project Leader
trend. – Multi-year, multi-stakeholder, multi-
– SinCo helps clarify questions, design & country projects
develop answers, and project – Developed framework for 25
manages thinking into action. country rollout by PRI in EM project
Investment architect that believes sustainability + investment are integrated.
Risks and opportunities for ESG appear in every investment decision.
3
4. Who We Are: SinCo helps leading clients tackle challenges
• Developed strategy for assessing innovative financing mechanisms to attract new capital in new
ways 2008-. Designed global ESG index architecture for developed, emerging and frontier markets
covering nutrition sector 2009-2011.
• Prepared strategy and lead the Africa Sustainable Investment Forum (AfricaSIF) project team
developing pan-African network for investment stakeholders 2009-.
• Supported stakeholder engagement connecting investors, analysts and companies assessing practice
of investment valuation globally in 2008
• Designed sustainable investment ESG architecture across trillion-dollar AUM, 200 analyst private
equity, equity, fixed income and global real estate asset classes. Provided peer benchmarking for
ESG strategy and developed change management program for global ESG roll-out 2006-2009.
• Developed strategy for 25 emerging markets in 2007 and launched EM project for sustainable
investment by institutional investors. Created network infrastructure, stakeholder relationships and
built PRI in EM through 2008.
• Conducting seminal study of sustainable investment in sub-Saharan Africa [S.Africa, Nigeria, Kenya]
across PE and listed equities in 2010 in partnership with RisCura; conducting primary research
interviewing over 1100 investors. In PE and listed asset classes inside/outside Africa 2009-2010
• Chaired the Association for Savings and Investment South Africa Responsible Investment Sub-Committee
Prudential Assets Working Group developing new policies for promoting ESG in investment
4
5. About ISE Sustainability Index
SinCo ROLE: INVESTOR STAKEHOLDERS ARCHITECTURE
• SinCo contracted to provide Sustainable • Universe of ISE-listed companies ranked
Investment advisory services for the on financial fundamentals and ESG
process design, development, facilitation factors e.g. energy efficiency, jobs
and implementation of a sustainability creation, carbon footprint etc
index project in Turkey, the Istanbul Stock • Index committee of Turkey /investment/
Exchange Sustainability Index (TBCSD sustainability experts. Third-party rating
ISESI Project). method with verification, review.
APPROACH KEY MILESTONES
• Opportunities to attract capital • Project launch announced @ ISE on 10
• Identifying winners in sustainability meta- August 2010 by Presidents of ISE + TBCSD
theme; competitive context drives • Briefing to companies, investors and
changes stakeholders in Turkey on project; input
• Indices will be used by investment on core ESG issues, Oct-Dec 2010
managers to integrate Environmental, – Further briefings and workshops to
Social and Governance criteria into their develop relevant criteria.
investment processes for benchmarking, – Regular updates and reporting online
asset allocation. • Criteria finalized and first annual rating
process begins; companies assessed on
TEAM ESG factors; rating agency and
company reporting. Index model tested
• ISE seeking local and international with company ESG profiles based on
partners: data/criteria/ranking
– TBCSD/WBCSD - company initiative
promoting sustainability, Cheryl Hicks
– SinCo - sustainable investment architect LAUNCH
– SAM - ESG ratings and indexes • Index modeled and launched by ISE +
TBCSD around Dec 2011.
5
6. ISE Sustainability Index Project 2010 - 2011 Launch Briefing
Istanbul Turkey, 10 August 2010
isesi.org
8. Emerging Markets Basics
• EM originally brought into fashion in the 1980s by then World Bank
economist Antoine van Agtmael.
– Political scientist Ian Bremmer defines an emerging market as "a country
where politics matters at least as much as economics to the markets".
• New terms have emerged to describe the largest developing
countries
– BRIC that stands for Brazil, Russia, India, and China
– BRICET (BRIC + Eastern Europe and Turkey)
– BRICS (BRIC + South Africa),
– BRICM (BRIC + Mexico)
– BRICK (BRIC + South Korea)
– CIVETS (Colombia, Indonesia, Vietnam, Egypt, Turkey and South Africa)
– Big Emerging Market (BEM) economies are (alphabetically ordered): Brazil,
China, Egypt, India, Indonesia, Mexico, Philippines, Poland, Russia, South
Africa, South Korea[9] and Turkey.
• Nations with social or business activity in the process of rapid growth
and industrialization.
• Lie at the intersection of non-traditional user behavior, the rise of new
user groups and community adoption of products and services, and
innovations in product technologies and platforms.
8
9. What Do Global Emerging Markets Investors Want From Sustainable
Investment?
• Investment opportunities for new returns [uncorrelated?] and
diversification of risks/rewards
• Investments in EM are made with
– ESG-driven mandates with filter for ESG built into mandates and/or
norms or values driven
– ESG-agnostic but risk averse and prefer ESG “halo effect”
– Cost-sensitive to research or execution costs; liquidity risks
• Opportunity to deliver compelling investment proposition at
country, exchange, sector or company levels
9
10. Investor Stakeholder Mapping
Consumer
NGO
Popular Media
ESG
Trade Experts
Associations
Specialist
Company Media
Business
Media
Govt
Investors
Primary audiences
10
13. EM Institutional investors: CalPERS and Dimensional/KLD
CalPERS
• US's largest public 'pension fund' + retirees. • Three stages of EM investment
USD. > 200b AUM policy development:
• Board/investment committee structure: Board
– < 2002: ¨passive/index based
= fiduciary responsibilities & makes decisions,
committee advises – 2002-2007: permissible countries
• History of shareholder activism – > 2007: principles based
– Apartheid, tobacco & global warming approach
CalPERS in EM • EM principles applied from 2007
Dimensional: a 'stock picking' specialist. Cf. 1. Politically stable
Eugene Fama and: "There is a new model of 2. Transparency in information
investing: a model based not on speculation 3. Abstinence from harmful labor
but on the science of capital markets" practices
http://www.dfaca.com/index.shtml. USD111b
4. Promotion of corporate social
AUM
responsibility and sustainability
• KLD Research and Analytics, Inc.: investment
5. Market regulation and liquidity
research firm specialized in SRI and a pioneer
(early 1990s) in the development of U.S. & 6. Free market policies, openness,
global indexes of 'ESG acceptable' legal protection
companies 7. Reasonable trading and
• KLD provided analysis for Dimensional (e.g. for settlement in markets
screening on labor practices) 8. Appropriate disclosure on ESG
• KLD+Dimensional helped CalPERS implement
its investment principles after 2007 • CNOC/Petrochina: difficult to
apply CalPERS' principles in
China
13
13
14. EM Institutional Investors: Actis PE
• Actis
• Leading private equity investor in • Policy Impact: Actis specialists assess the
emerging markets. Operating for 60 impact of all new investments in each of
years the five policy areas as an integral part
– $7.3 Bn raised, $3.1 Bn investd of the appraisal process and determines
– Goal: to promote sustainable growth in the appropriate level of management
emerging markets to ensure “a lasting and monitoring required.
tangible and positive difference” in target – Agreement: Company management are
countries. required to sign an agreement confirming
• What is ESG code? that they will operate in line with the Five
– Guidelines, policies and methods for Policies.
monitoring the ESG approach in – Action Plan: Actis assists companies in
companies within portfolio and under developing action plans to address areas
consideration. of noncompliance with policies and
oversees implementation.
• Actis Five Policies
– 1– Environmental • Reviewing
– 2– Climate change – Annual reporting on the implementation
of procedures.
– 3– Health & safety
– Summary: Actis provides a summary of
– 4– Business integrity the development impact of each fund in
– 5– Social issues the regions in which it is investing
• Steps to implement the ESG approach: (including a statement relating to each
– Policy specialization: Actis has internal fund's carbon footprint).
experts, advice throughout the lifecycle • Auditing
– Negative Screening: Specific sectors are – Ongoing Auditing: Actis audits the
excluded from investment. implementation of the Actis Five Policies
and related procedures on an ongoing
basis.
14
14
15. Contents
• Global SI Market Snapshot
• SI in Europe
• SI in the United States
• SI in Emerging Markets
• Brazil
• India
15
15
16. Global SI Market Snapshot
Global SI Market is Growing and Regional Influence is Shifting
2006 2010
2008
Source: Eurosif Research
16
17. Contents
• Global SRI Market Snapshot
• SRI in Europe
• SRI in the United States
• SRI in Emerging Markets
• Brazil
• India
17
17
18. SRI in Europe: Market Size
Total EU SRI assets under management have reached
€4.986 trillion as of 31/12/09
Source: Eurosif Research
* Re-calculated according to the 2010 Core SRI definition
18
19. SRI in Europe: Market Characteristics
Core SRI - €1.2 trillion Broad SRI - €3.8 trillion
Core strategies consist of norms- and values- Broad strategies consist of simple exclusion,
based exclusions as well as different types of engagement and integration, often in combination
positive screens (Best-in-Class, thematic funds and with one another.
others).
Integration, the inclusion of ESG risk into traditional
Norms- and values-based exclusions are the most financial analysis, is gaining ground with some
popular Core strategies in Europe, driven by the European investors, encouraged by the PRI Initiative.
Netherlands and Nordic countries.
Source: Eurosif Research
19
20. SRI in Europe: Market Drivers / Barriers
Demand from institutional investors remains a key driver, along with
international initiatives, external pressure and demand from retail investors.
Source: Eurosif Research
20
21. Contents
• Global SRI Market Snapshot
• SRI in Europe
• SRI in the United States
• SRI in Emerging Markets
• Brazil
• China
• India
• MENA region
• Sub-Saharan Africa
21
21
22. SRI in the United States: Market Size
• “Sustainable and socially responsible investing (SRI) in the United
States has continued to grow at a faster pace than the broader
universe of conventional investment assets under professional
management.”
• “At the start of 2010, professionally managed assets following SRI
strategies stood at $3.07 trillion, a rise of more than 380 percent from
$639 billion in 1995, the year of the Social Investment Forum
Foundation’s first Trends Report. Over the same period, the broader
universe of assets under professional management increased only
260 percent from $7 trillion to $25.2 trillion.”
• “As a result of this growth, nearly one out of every eight dollars under
professional management in the United States today—12.2 percent of
the $25.2 trillion in total assets under management tracked by
Thomson Reuters Nelson—is involved in some strategy of socially
responsible investing.”
Source: Social Investment Forum Foundation. “2010 Report on Socially Responsible Investing Trends in the United
States.”
22
22
23. SRI in the United States: Market Size
Source: Social Investment Forum Foundation. “2010 Report on Socially Responsible Investing Trends in the United States.”
23
24. SRI in the United States: Market Characteristics
• “The total assets managed under policies that explicitly
incorporate ESG criteria into investment analysis and portfolio
construction (ESG assets) are valued at $2.51 trillion.
– Of these ESG assets, $691.9 billion were identified within specific
investment vehicles managed by money managers, while at least
$2.03 trillion were identified as owned or administered by
institutional investors.
– Of the institutional ESG assets, $206.3 billion were managed
through investment vehicles captured in research on money
managers.”
Source: Social Investment Forum Foundation. “2010 Report on Socially Responsible Investing Trends in the United
States.”
24
25. SRI in the United States: Drivers and Barriers
• “Over the past decade, SRI growth within US financial markets has been
shaped by numerous trends:
– Money managers are increasingly incorporating ESG factors into their
investment analysis, decision making and portfolio construction, awakening to
the demand for ESG investing products and services from institutional and
individual investors. Of the managers that responded to survey questions on
their reasons for incorporating ESG criteria into investment management, more
(85 percent) cited client demand than any other reason.
– Institutions—particularly public funds—are incorporating ESG criteria in part
because of legislative mandates. Among the institutions that responded to
survey questions about why they incorporated ESG factors into their
investments, more (52 percent) cited regulation or legislation than any other
reason.
– New products and fund styles are driving growth in ESG investment vehicles,
especially among ETFs and alternative investment funds such as social venture
capital, double- and triple-bottom-line private equity and responsible property
funds.
– Environmentally themed investment products and services are rapidly
emerging to meet growing investor desire to manage environmental risks and
seize opportunities in clean and green technology, alternative and renewable
energy, green building and responsible property development, and other
environmentally driven businesses.”
25
25
26. Contents
• SRI in Europe
• SRI in the United States
• SRI in Emerging Markets
• Brazil
• India
26
26
27. SRI in Emerging Markets: Market Size
• “(Although) further research on the business case is welcome, the two
surveys show that the majority of asset owners, fund managers and
emerging market corporations are already convinced of the link between
ESG behaviour and superior investment results.”
• “Asset owners – arguably the most influential participants in the investment
value chain – were more inclined to agree with the statement “ESG issues
are an important part of our research, portfolio management and
manager selection process” in 2009 than in 2007. Approximately 46%
strongly agreed with this statement in 2009, up from 36% in 2007.”
• 82% of surveyed asset owners say that ESG assessment will become
significantly more important in their research, portfolio management and
manager-selection process over the next three years.”
Source: International Finance Corporation (IFC). “Sustainable investing in emerging markets: unscathed by the financial crisis.”
27
27
28. SRI in Emerging Markets: Drivers/Barriers
• “Seen from a policy perspective, the pressure to improve corporate disclosure is
key to moving forward on sustainable investing. Most emerging markets have
made significant progress in improving corporate governance. Nevertheless,
corporate governance advocacy programs could do more to help investors and
issuers understand the value of transparent ESG reporting.”
• “Finally, in both the 2007 and 2009 surveys, asset owners highlighted a scarcity of
emerging-markets ESG talent among consultants and fund managers. This gap
represents an opportunity – one that a number of investment banks, data
providers and securities research organisations are moving to exploit. And there is
little doubt that this lack of capacity will be needed: 82% of surveyed asset owners
say that ESG assessment will become significantly more important in their research,
portfolio management and manager selection process over the next three years.
• The same group expects to increase emerging-market allocations by about 2%
over the same period. The institutions at the top of the value chain are ready to
move forward – and the advisors, managers and consultants who support them
have received a mandate to help.”
Source: International Finance Corporation (IFC). “Sustainable investing in emerging markets: unscathed by the financial crisis.”
28
28
29. SRI in Emerging Markets: Drivers/Barriers
Source: International Finance Corporation (IFC). “Sustainable investing in emerging markets: unscathed by the financial crisis.”
29
29
30. SRI in Emerging Markets: Drivers/Barriers
Source: International Finance Corporation (IFC). “Sustainable investing in emerging markets: unscathed by the financial crisis.”
30
30
31. SRI in Emerging Markets: Drivers/Barriers
Source: International Finance Corporation (IFC). “Sustainable investing in emerging markets: unscathed by the financial crisis.”
31
31
32. SRI in Emerging Markets: Drivers/Barriers
Source: International Finance Corporation (IFC). “Sustainable investing in emerging markets: unscathed by the financial crisis.”
32
32
33. SRI in Emerging Markets: Drivers/Barriers
Source: International Finance Corporation (IFC). “Sustainable investing in emerging markets: unscathed by the financial crisis.”
33
33
34. SRI in Emerging Markets: Drivers/Barriers
Source: International Finance Corporation (IFC). “Sustainable investing in emerging markets: unscathed by the financial crisis.”
34
34
35. Contents
• SRI in Europe
• SRI in the United States
• SRI in Emerging Markets
• Brazil
• India
35
35
36. SRI in Brazil: Market Size & Characteristics
• “Sustainable” investment could therefore be at
least 10 per cent of market cap. Taking a
conservative approach, TERI‐ urope believes
an estimate of US$40 billion (<7 per cent of total
market cap) may be more useful for
comparative and decision‐ aking purposes.”
• “Today, ten asset managers offer retail SRI
funds with combined assets under
management of about US$315 million.”
• “18 pension funds have signed the UN Principles
for Responsible Investment (PRI). Together they
represent combined assets of US$110 billion, or
about 60 per cent of the country’s total pension
fund corpus.”
• “TERI‐ urope has used a working assumption
that ESG investment styles account for about 1
per cent of foreign portfolio investment and
investment in Brazilian ADRs, i.e. approximately
US$2.2 billion.”
Source: International Finance Corporation (IFC). “Sustainable Investment in Brazil 2009.”
36
36
37. SRI in Brazil: Drivers and Barriers
– “Brazil has an advanced framework of environmental legislation and
inspection at both the federal and state levels (see box). However,
enforcement standards vary from state to state and between federal and
state agencies for reasons ranging from lack of resources to the influence
of corruption. In addition to federal and state environmental protection
agencies, federal and state public prosecutors are able to take
independent action to deal with environmental problems, and do so
frequently and effectively.”
– “60 per cent of the country’s pension fund assets are already managed by
UNPRI signatories.”
– “Brazilian companies have a relatively long tradition of non‐ inancial
disclosure. The current emphasis in Brazil is on voluntary GRI reporting.”
– “A growing number of Brazilian companies are producing annual
sustainability reports, many using the Global Reporting Initiative (GRI)
guidelines.”
Source: International Finance Corporation (IFC). “Sustainable Investment in Brazil 2009.”
37
37
38. Contents
• SRI in Europe
• SRI in the United States
• SRI in Emerging Markets
• Brazil
• India
38
38
39. SRI in India: Market Size
“TERI-Europe estimates that the total stock of investment in Indian equities
where the investment strategy includes a strong focus on environmental,
social and governance (ESG) considerations is approximately US$1 billion at
the current time. This is almost entirely composed of investment by foreign
institutional investors (FIIs).”
Source: IFC & Teri Europe. “Sustainable Investment in India 2009.”
39 39
40. SRI in India: Market Characteristics
• “India has limited domestic sustainable investment market or
infrastructure in the listed equity space.”
• “The country’s first and so far only retail SRI mutual fund was launched by
ABM AMRO in March 2007 and raised the equivalent of approximately
US$12 million.”
• “In contrast to the situation in the listed equity market, there is a growing
interest by the private equity industry in India to exploit opportunities in
the sustainability space. The growth of PE funds in general and venture
capital in particular is encouraging from a sustainability perspective since
the ownership structure of this asset class has the potential to ensure that
ESG issues can be successfully integrated into management systems
provided of course that there is a willingness to do so.”
40
40
41. SRI in India: Drivers & Barriers
• DRIVERS:
– ESG transparency and disclosure by Indian companies in the form of
corporate sustainability reports and responses to the Carbon Disclosure
Project are slowly improving, but from a very low starting point.
– There is relatively strong and growing interest in ESG risks and opportunities
amongst India’s Foreign Institutional Investors.
– There is a growing interest by the private equity industry in India to exploit
opportunities in the sustainability space.
• BARRIERS:
– There is little interest in sustainable investment in India’s rapidly growing
mutual fund and life insurance market at the current time.
– The enabling environment for sustainable investment in Indian listed
equities is currently weak.
Source: IFC & Teri Europe. “Sustainable Investment in India 2009.”
41
41
42. Contents
• SRI in Europe
• SRI in the United States
• SRI in Emerging Markets
• Brazil
• India
42
42
43. Defining SI/ESG space: both investor and investee perspectives
Fund strategy determines for whom sustainability must be defined globally and locally.
• Investment perspective looking toward investment opportunities…
– …Responsible Investment is an active asset management approach that takes
financial, fundamental, and also environmental, social, ethical, and governance issues
into account in the implementation of investment decisions.
– …Definition of SI/RI/ESG/extra financials: Factors which are likely to have at least long-
term effect on business results but which seldom get integrated into traditional financial
analysis. These factors can include, but are not limited to; IP, human rights,
occupational H&S, R&D, customer satisfaction, corporate governance, climate
change and sustainable energy and other E&S impacts.
• Corporate perspective looking toward investor opportunities…
– Environmental, social, ethical, and governance issues are embedded in any firm's
corporate strategy. Anything that affects a firm's business model can also affect the
firm's financial performance and therefore its valuation…these issues are no exception.
• CFA Institute papers on ESG:
– 2007 The Compensation of Senior Executives at Listed Companies: A Manual for
Investors helps investors understand how boards develop and decide on
compensation systems for the individuals hired to manage these companies.
– 2008 Environmental, Social, and Governance Factors at Listed Companies: A Manual
for Investors addresses key, non-financial risks and opportunities that investors may
confront, and suggests ways to evaluate these issues. Focuses on the legislative and
regulatory, legal, reputation, and operational ESG risks and opportunities shareowners
need to consider to fully understand investee companies…incorporating those risks or
opportunities into the analysis process.
Sources: 1. The Relevance of Socially Responsible Investing to Research Analysts and Financial Markets, Julie Hudson, CFA, Managing Director
and Analyst, UBS, Frank K. Reilly, CFA (Moderator), University of Notre Dame, Recorded on 21 May 2006, Presented by CFA Institute, 2.
Environmental, Social, and Governance Factors at Listed Companies: A Manual for Investors, CFA Institute Centre for Financial Market
Integrity, September 2008. 3. The Compensation of Senior Executives at Listed Companies: A Manual for Investors, July 2007.
43
46. What Do Global Emerging Markets Investors Want From Sustainable
Investment?
• Investment opportunities for new returns [uncorrelated?] and
diversification of risks/rewards
• Investments in EM are made with
– ESG-driven mandates with filter for ESG built into mandates and/or
norms or values driven
– ESG-agnostic but risk averse and prefer ESG “halo effect”
– Cost-sensitive to research or execution costs; liquidity risks
• Opportunity to deliver compelling investment proposition at
country, exchange, sector or company levels
46
48. Credentials: testimonials for SinCo…
• “Graham is an exceptional professional in all that he does. His work is at the crossroads of
business intelligence, finance and investments and sustainability. His ability to clarify
objectives and execute on solutions has demonstrated the fruitful success of the business
case for sustainability.”
– Director and Senior Investment Analyst, global institutional asset manager, New York City.
• Graham served as a strategic adviser to a large US Asset manager as we worked together on
developing their sustainable investment strategy. He provided on-going support to their
internal team and served as a knowledgeable and helpful sounding board as their staff tried
to move sustainability forward
– - Senior Client Relationship Manager, Global ESG ratings and research provider, London
• Graham is a very focused, passionate and results driven promoter and believer in the change
role that a shift to of Responsible Investments can and will effect in our globalising world. He is
comfortable with holding a strong opinion yet cable of being a consensus builder
– - Portfolio Manager, Responsible Investment equity portfolio, Cape Town.
• "For many investors, getting to grips with ESG issues in emerging markets is a top priority. [He]
was crucial in encouraging new partnerships in diverse markets..."
– Clean tech private equity fund manager and former Executive Director, ASRIA, Hong Kong.
• Graham has shown a fantastic drive and commitment to the PRI initiative. He clearly helped
promote the ESG thematic to the top of our priorities.
– - Chief Risk Officer, hedge fund-of-funds investment house, Zurich.
• "Graham is one of our leading thinkers on SRI. The work that Graham is doing will transform SRI
and take it to the next level."
– Managing Director, equity investment manager, Boston.
• "Graham Sinclair's work is excellent."
– Executive Diretor, billion-dollar global foundation, Philadelphia.
48
49. About Graham Sinclair
• Graham Sinclair is a sustainable investment strategist, ESG architect and global
project leader at Sinclair & Company [SinCo]. Graham has eight years
specialist experience in sustainable investment globally after eight years in
pensions consulting and investment banking in Africa. Recent consulting
engagements in sustainable investment include:
– Leading IFC-funded research into private equity and liquid equity ESG strategies in sub-
Saharan Africa in South Africa, Kenya and Nigeria to be published in Q2 2010.
– Developing innovative financing mechanisms strategy and ESG index architecture for
developed, emerging and frontier markets for a Swiss-based international organization.
– For a global institutional investment firm in New York with a USD 1 trillion AUM portfolio,
designing ESG architecture across private equity, liquid and global real estate portfolios
covering philosophy and process innovations and investment strategies.
– As consultant to the UN, developed strategy for 25 emerging markets and launched PRI
in Emerging Markets project in Q3 2007 for UNEP FI, creating a network infrastructure,
building relationships with 108 investor stakeholders including in Africa through 2008.
– Lecturing on ESG in investment strategies at investment practitioner symposia and
leading business schools in Europe, Africa and the US. Currently developing case
studies on ESG investment in emerging markets for his forthcoming book.
• Before starting his eponymous investment advisory boutique SinCo in 2006, he
was Product Manager at KLD Research & Analytics, Inc, based in Boston. He is
a former contributor to the CSR Initiative at Harvard Kennedy School,
Distinguished Member of Net Impact, alum of WWF One Planet Leaders
programme and the Tallberg Forum New Leaders Program. He holds diplomas
in retirement funds and insurance law, and in 1998 he was one of the youngest
ever dual-FILPAs. He currently leads the AfricaSIF Project building a not-for-profit
Africa Sustainable Investment Forum network.
• Graham earned his MBA on scholarship at Villanova University USA where he
co-managed the Arnone-Lerer SRI Fund equity portfolio in 2004. He holds a
B.Com from the University of Natal and LL.B from its Howard College School of
Law as well as numerous industry specialist certifications.
49
50. About Project team: Roselyne Yao
Roselyne Yao is an Analyst at the sustainable investment architecture firm SinCo, where she
conducts sustainable investment strategy research and analysis.
Roselyne joined SinCo in October 2010 as Analyst on the IFC-commissioned research project,
Sustainable Investment in sub-Saharan Africa 2010. She previously was a Research Analyst for JPS
Global Investments (a California-based money management company focusing on sustainable
investing) and an Intern for the Social Research and Advocacy team at Walden Asset Management
(a Boston-based socially responsible investing company).
Roselyne is also an AfricaSIF Steering Committee member.
Roselyne passed the CFA level I exam in June 2009 and plans to sit for the CFA level II exam in June
2011. She holds a Master in Business Administration (with a double concentration in Finance and
Marketing), a Certificate in Global Business Culture, and a Certificate of Excellence in Sustainable
Management and Technology from the University of Illinois. She currently resides in Dakar, Senegal.
50
50
51. SinCo vision of the world tomorrow
“Together, we can partner on behalf of our planet and prosperity and help countries increase
access to power while skipping - leapfrogging - the dirtier phase of [invest]ment”.
- Barack Obama, 44th president of USA in address to Ghanaian parliament, Accra, 11 July 2009
51
52. Marketplace: ESG/SI trends, new drivers of supply and demand
Goldman Sachs Research GSSustain philosophy is used to identify sustainable
alpha in a changing world, focus on emerging sectors; emerging industries.
Infrastructure Urbanisation Consumer markets Human capital
BRICs competitors
investment accelerating diverging shortages
New sources of The world is changing more Healthcare systems
capital strained
rapidly than ever before…
Natural resource
New technologies
constraints
Where do we
Reduced
find FUND Climate change availability of credit
philosophy
stacking up in
2010?
Political case: what Business case: where Moral case: what
are legislators and are leading firms have business and
regulators driving positioning for civic leaders identified
companies and competitive as worthy of action
projects toward in advantage in ESG despite the current
frontier/emerging issues today for future economic
markets today? market leadership? arguments?
Source: SinCo adaptation from Goldman Sachs Investment Research, March 2009 1
52
53. Sustainable Investment Architects
REGULATORY INFORMATION
No part of this proposal suggests or should understood to suggest endorsement or advice on any investment approach, strategy or offering. The
rights and obligations of the investor are set out in the relevant policy contract. Market fluctuations and changes in rates of exchange or taxation
may have an effect on the value, price or income of investments. Since the performance of financial markets fluctuates, an investor may not get
back the full amount invested. Past performance is not necessarily a guide to future investment performance.
53
53
54. Contact Details
Graham Sinclair
graham.sinclair@sinclairconsult.com
+27.82.712.1925 | +1.484.802.9908
54
55. SAMPLE: Investor Workshop Key Questions
• DEFINITION:
– How does the EM investor/investment stakeholder define “sustainable
investment” in Turkey?
• ESG IMPORTANCE:
– What environmental, social and governance (ESG) issues are important to
EM investors?
• CONTRAST:
– What similarities and differences between international vs local investors
have regarding investing in EM?
• EXAMPLES:
– What examples of ESG issues impacting investments or market
capitalization [e.g Enron-corporate governance or BP-environmental
disaster] are famous in EM in the past 20 years, and what lessons have
investors learned?
• DRIVERS/BARRIERS:
– What do you think are the main reasons why investors in EM today DO or
DO NOT include environmental, social and governance (ESG) factors in
their investment decisions.
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