KBI highlights data concerns across industry in impact report
KBI’s report links its activities to the UN Sustainable Development Goals.
KBI Global Investors, the institutional investment arm of Amundi, has highlighted data scarcity concerns in its latest impact report.
According to KBI, the firm’s proprietary research methodology was introduced five years ago in the absence of any agreed or common approach to impact reporting or impact measurement.
Geoff Blake, director and head of business development and client service at KBI Global Investors, said: “Many companies still do not even attempt to report on the impact of their own operation, and for the companies that do, it has been nigh impossible to compare the results with those reported by other firms.
“Data suppliers have recognised this gap and are beginning to provide investors (and asset owners) with reports on the extent to which investment portfolios are aligned with the SDGs [Sustainable Development Goals]. But to date, this has not been fully satisfactory.”
In particular, Blake highlighted that data is not available at the right level of granularity – especially for smaller companies.
He added: “This kind of work faces considerable challenges if not carried out by portfolio managers or analysts who know ‘their’ companies extremely well.”
Many companies still do not even attempt to report on the impact of their own operation, and for the companies that do, it has been nigh impossible to compare the results with those reported by other firms.
KBI’s impact scores for 2021
The KBI impact report focused on its Revenue Alignment SDG Scores (RASS) for 2021; these scores assess the companies held in its suite of natural resources strategies.
KBI’s Global Resource Solutions Strategy is dominated by increasing investment in infrastructure and technological advancement across water, agribusiness, and clean energy, and delivered a RASS score of 69.9% in the latest analysis – the percentage of revenues contributing to the achievement of the SDGs – with a positive contribution to eight SDGs.
Within KBI’s Natural Resources suite, the Circular Economy Strategy was rated highest, posting a net RASS score of 78.8%. The Global Energy Transition was lowest, scoring 63.8%.
With the Water Strategy, the KBI committee concluded that the gas heater business of one investee company should be classified as neutral until alternative forms of non-fossil-fuel heating are available and viable.
In the firm’s Global Energy Transition Strategy, the committee discussed the negative impact of mining rare earth minerals, considered by KBI as a very carbon-intensive activity, where many mines are illegal, and all but two mines in the world are based in the emerging markets, where regulation is lax.
Founded in 1980 in Dublin, Ireland, KBI Global Investors has $24bn in assets under management.
