Eugene Grygo, Chief Content Editor, FTF News
Controversial environmental, social and governance (ESG) concerns that are being used to screen investments are gaining ground with the buy side.
In one very important example, the California State Teachers’ Retirement System (CalSTRS), the pension fund for public school educators of California, is literally putting its ESG money where its mouth is.
Pension officials have been publicly embracing ESG criteria and this past October announced that they want to hire six investment firms with a history of embracing ESG goals.
In addition, CalSTRS officials last week heralded their “first social bond purchase, worth $5 million” via a three-year, $500 million global benchmark bond issued on March 22, 2017, by the International Finance Corporation (IFC), part of the World Bank, officials say. CalSTRS is one of more than 40 institutional investors behind the bond issue.
The bond proceeds “will go toward financing women-owned enterprises and projects for low-income communities in emerging markets, while providing competitive returns to the teachers’ fund,” CalSTRS officials say. “Using financial vehicles that provide potential for us to do well, while also doing good, is a double win for us,” says Christopher J. Ailman, CalSTRS chief investment officer, in a statement.
In particular, the proceeds from this World Bank bond are slated to provide investments in activities such as:
- Companies that source directly from smallholder farmers;
- Utilities that provide low-income households with better access to services;
- Companies that provide more affordable health and education services or housing to low-income populations;
- Companies that provide goods and services to low-income populations;
- Companies that provide telecommunication and payment platforms in markets that include low-income users;
- And lending to financial intermediaries that lend to women-owned enterprises.
CalSTRS officials report that the bond incorporates 4.5 billion people “at the bottom of the financial pyramid who have $5 trillion in purchasing power,” according to the IFC. The CalSTRS portfolio is valued at $202 billion as of February 28, 2017, and is the largest educator-only pension fund in the world, officials say.
A Quick FTF Awards Voting Reminder
Switching gears from ESG goals, this is a reminder that there is still time to cast your vote in the FTF News Technology Innovation Awards 2017, presented by Financial Technologies Forum and its news service.
As you may know, industry professionals and not judges pick the award winners in an effort to celebrate and recognize those actually working in securities operations, financial technology vendors, service providers, industry bodies and outstanding individuals that made significant strides toward operational excellence. The awards process honors achievements during the prior year.
The voting for the awards opened on March 1, 2017 and will end on April 7. Sources familiar with the situation tell us that FTF is on its way to set a new record for actual votes. We also have a bit of news as far as the venue for the awards gala: it will be held June 20, Tuesday, at the Dream Downtown Hotel, 355 West 16th St., near Ninth Avenue, New York, NY 10011.
So, if you haven’t yet, please click here to vote.
If you have already voted, please get your gown or business attire ready, find your dancin’ shoes, and come party with us as we will need a few laughs this year.
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