The Association of Investment Companies (AIC) is set to publish individual investment company ESG disclosures amid growing demand from investors.
From the second quarter of 2021, the AIC will give member investment companies the opportunity to share their ESG policies on their profile pages to appear alongside existing information such as performance data and portfolio holdings.
Companies will be able explain their ESG approach and state different criteria, including whether they have adopted or signed up to sustainability initiatives such as the UN Principles for Responsible Investment or Sustainable Development Goals. In addition, companies will be able to list whether they actively exclude specific sectors such as tobacco or gambling.
The AIC said all its member investment companies were being encouraged to submit ESG disclosures, which can be updated at any time, following what it described as a “rapid increase” in enquiries from private investors, advisers and wealth managers to find out more about the ESG credentials of investment companies.
Ian Sayers, chief executive, Association of Investment Companies, said: “Investment companies’ reports and accounts already contain valuable information on ESG strategies, but we wanted to make it even easier for investors to find ESG criteria alongside other data they use to inform their investment decisions.
“The new pages will give investment companies the opportunity to explain their approaches, from how they engage with investee companies, to their integration of ESG principles in investment selection. As the appetite for this kind of information grows, we hope this information will help investors make investment decisions that align with their non-financial goals.”
Sayers added: “Investment companies have unique advantages which make them well suited to ESG strategies. Their closed-ended structure and stock exchange listing mean they are particularly suitable for hard-to-sell illiquid assets which address ESG needs such as renewable energy infrastructure, social housing and impact investing. They also have independent boards whose job it is to protect the interest of shareholders, providing an extra layer of independent governance.”