Robeco: For insurers, unprecedented risks require unprecedented solutions
As the UK’s largest pension and long-term savings business, Phoenix Group is no stranger to managing long-term risk. But climate change presents systemic hazards that require innovative approaches.
14.11.2023 | 05:24 Uhr
Together with Robeco, Phoenix Group created a bespoke, multi-asset solution that not only helps mitigate climate risks but also helps in its efforts to capture the alpha opportunities stemming from green growth.
The climate crisis, resource deficits and biodiversity loss
are putting companies, industries, the financial sector and the entire
global economy in a state of heightened risk. But the weight of concern
doesn’t just sit with big institutions. According to Sindhu Krishna,
Head of Sustainable Investing at Phoenix Group’s asset management unit,
workers, households and retirees are also shouldering the burden –
concerned with how it will impact the world as well as their financial
future.
Responsibility to customers and society
Krishna says those
concerns are reflected in changing customer attitudes and product
preferences towards more sustainability. And with nearly 12 million
customers spread across the UK and continental Europe, Phoenix’s results
can be seen as a good gauge of shifting societal preferences on climate change and the role of insurance and investing to address it.
“Climate’s
visibility and scale is dominating, but there are other financially
material risks that cannot be ignored if we are to improve customer
outcomes. At Phoenix Group, we’re working hard to understand and
integrate environmental, social, and governance factors into our investment portfolios, so that we can continue to help our customers to and through retirement.”
“Meeting those future obligations requires executing responsible investing strategies now,” Krishna says.
Multiple objectives, one mandate
Based on its strong reputation as an innovator and thought leader in sustainable investing, Phoenix enlisted the support of Robeco for a deep dive into the latest SI analytics and to co-develop a sustainable, multi-asset solution to meet its long-term investment objectives.
The genesis of the mandate was rooted in addressing SDG 13 (Climate action). Krishna explains that while learning how to de-risk and decarbonize portfolios over the long term is critical, Phoenix also wants to capitalize on the solution providers that enable the transition to a sustainable economy.
“While learning how to de-risk and decarbonize portfolios over the long term is critical, Phoenix also wants to capitalize on the solution providers that enable the transition to a sustainable economy."
“Trillions in capital flows need to be funneled to the SDGs
by 2030; there’s money to be made connecting investors with the
opportunities across water, education, poverty and nature. Robeco’s SDG
framework helps convert these needs into an investable pipeline for
investors who want to do good without compromising market returns.”
Robeco was able to draw from an extensive toolkit of investment methods
and strategies to create a bespoke 60/40 portfolio that includes equity
strategies focused on net-zero climate, sustainable property, smart
energy, smart materials and smart mobility opportunities. The bond side
will focus on global climate bonds, green bonds and SDG high yield
bonds.
Krishna liked the
rigor and clarity of Robeco’s SDG approach, which preceded even the EU’s
own taxonomy for defining sustainable investment activities.
“There
was a lot of emphasis on risk management which combined deep
quantitative tools, fundamental experience, and systematic frameworks to
measure alignment with SDGs related to the climate transition.”
Click here to learn more about Phoenix’s journey as well as to access Robeco’s latest Big Book of SI – our reference guide on sustainable research and investment solutions.
Die Informationen auf der nachfolgenden Website der Robeco Deutschland, Zweigniederlassung der Robeco Institutional Asset Management B.V., richten sich ausschließlich an professionelle Kunden im Sinne von § 31a Abs. 2 Wertpapierhandelsgesetz (WpHG) wie beispielsweise Versicherungen, Banken und Sparkassen. Die auf dieser Website dargestellten Informationen sind NICHT für Privatanleger bestimmt und entsprechen nicht den für Privatanleger maßgeblichen gesetzlichen Bestimmungen.
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