Over the past year, the nuclear disaster in Japan and the social unrest in the Sudan has refocused many investors on SRI/sustainable investment asset managers. These managers are also beating benchmarks, a positive step for an industry that has struggled to match returns in other asset classes.
Two managers narrowly missed being shortlisted: F&C Asset Management, and Aviva Investors. Excluding them was a tough decision, because both have long records as leaders in corporate engagement, while F&C's George Dallas and Aviva Investors' Anita Skipper are highly-regarded.
This year, though, we felt more inclined towards managers that have made SRI/Sustainable Investment even more central to their business: in the case of some of the nominees in our 2011 shortlist, it is all they do.
Our 2011 SRI/Sustainable Investment Manager of the Year shortlist is as follows.
The Central Finance Board of the Methodist Church & Epworth Investment Management
The truly global and social reach of the Methodist Church gives its fund manager extraordinary power to engage with companies and monitor their activities everywhere. The Central Finance Board/Epworth, which invests £1.2bn on behalf of churches and charities, has helped persuade BSkyB to close its pornographic channels, Shell to publish information on its oil sands projects, and beaten the market.
The firm co-founded in 2004 by Al Gore and David Blood, with a team of 45 in 16 countries, believes that respecting economic, environmental, social and governance criteria will drive a company’s returns over the long term.
Impax Asset Management
This specialist environmental investor is now being recommended by some of the largest investment consultants after significantly outperforming its benchmarks.
Pictet Asset Management
Separate funds investing in the themes of water, clean energy, timber and agriculture have allowed investors to invest in these areas. It water fund, the oldest in this range, has generated top quartile performance amongst global equity funds over one and five years, while its timber fund has been top decile over one year.
SAM has expanded its offering of thematic funds to include a sustainable agricultural business fund as well as a smart energy fund and a smart materials fund that has outperformed its benchmark by 3.7 percentage points.