AXA Investment Management, a big global manager with a strong ESG pedigree, announced last week that it had boosted its ESG capabilities and that it would move to integrate ESG principles across all its portfolios. That is actually easier said than done.
Matt Christensen, the global head of AXA IM’s responsible investing oversight, said that the integration move was something he and his team had been working on for about 18 months. He has been at AXA since 2011 but prior to that had worked in the impact investing space, which is the pointy end of ESG. For investment professionals like him, the last 10-15 years have been a battle.
He said last week: “At AXA, the battle has been won.” The announcement said: “Leveraging its two decades of responsible investing (RI) experience, AXA IM is integrating ESG analysis into all of its investment platforms, providing fund managers with access to proprietary ESG scores and KPIs in their front office tools, as well as additional ESG data and research. Additionally, RI specialists are progressively being embedded into each investment team to support fund managers incorporate ESG and impact analysis into their investment processes.”
Of AXA IM’s US$520 billion, or so, under management, currently about US$19.8 billion is classified as “sustainable investing”.
Christensen said: “This new step to integrate RI throughout the business will ensure that ESG integration combines the need for common views on thematic engagements, voting and ESG scoring, while bolstering investment teams with detailed ESG corporate analysis. This will lead to increased transparency and clarity for our clients on the ESG footprint of their investments, allowing us to better engage with them and help to direct their funds into those companies that have a positive impact on society
“AXA IM has also developed an impact investing approach that goes beyond ESG risk monitoring to encompass those companies that are making positive contributions to the UN Sustainable Development Goals. Teams across the business are now even more involved in developing our RI offering, to better address our clients’ needs with the objective of reshaping certain strategies as ESG and launching new Impact strategies.”
The firm said that the AXA RI capabilities were now organised along these lines:
. A central RI team focusing on thematic research, corporate governance and shareholders engagement as well as on developing quantitative solutions.
. As climate, human capital and health have been identified as the key thematic priorities for the centralised RI team, specialists have also been appointed for each of these three themes. Lise Moret is responsible for the climate change strategy and Marie Fromaget has recently joined AXA IM as Human Capital & Diversity analyst. In addition to their responsibilities for the green and social bonds, Julien Foll covers health and Alice Val, climate. They will work with Yo Takatsuki, who is joining AXA IM as Head of ESG of Research and Engagement, effective November 1st.
. ESG specialists within the investment platforms to conduct ESG analysis at the company level. Some have already joined the investment teams: Melina Leprince-Ringuet for Framlington Equities, Shah Khan for Rosenberg and Rebecca Greenberg and Augustin Monnoyeur for fixed income.
Christensen said that ESG integration was a firm-wide approach, encompassing thematic and qualitative ESG analysis, proprietary ESG scoring, analytical solutions and reporting, as well as voting and engagement which all contributed to the investment decisions. In addition, ESG training was in place for all employees.