Gaeia, Ethical Investment Advice in the UK

Gaeia were delighted recently to be awarded runner up in the Responsible Investment IFA of the year awards, arranged by Unbiased.

The eighth annual Unbiased.co.uk Media Awards seek to recognise the valuable contributions of advisers to the public image of independent financial advice and professional advice in general.  This award recognises Gaeia’s knowledge, commitment and longstanding web presence, with its regularly updated news items, being of particular interest  to ethically inclined investors.

As well as providing a service to our industry, Unbiased provide a valuable service to members of the public, helping them find their way through the complexities of seeking advice and finding a professional service.

I left Manchester at 7am on a misty March morning, to drive to south east Wales in order to learn more about trees. Having grown up in the country, and now a Mother, I am increasingly keen to reconnect with lessons from my own childhood.
My parents taught me many plant species in my youth (even stretching to the Latin) and I have been frustrated that I have forgotten so much during my lengthy urban sojourn.
I now have a more suburban lifestyle, and during walks in our local woods was disappointed to be barely able to recognise even oak and beech.

So, browsing the Internet one night, I came across a tree identification course, held in Monmouthshire, by Kate Humble and her husband Ludo Graham via their Humble by Nature enterprise www.katehumble.com (new dedicated website launching soon www.humblebynature.com) They have part-bought a tenanted farm in the Wye Valley and organise courses here in Rural Skills and Keeping Livestock. I was happy to re- visit Wales, as many childhood holidays were spent here.

Kate and Ludo were very welcoming and spent the day learning alongside us, and their enjoyment of the countywide and passion for sustainable living were clear to see.

They were interested to hear about the Campaign for Real Farming, as we share common goals – such as support for sustainable small-scale farming, and gaining community involvement in local farms.
With the farmer Tim, we discussed the need to encourage young people back to farming as a career, and the importance of diversification – such as running these sorts of courses- to help small farms survive.

So, what did I learn about trees? We were taught by Phil Webb, Proprietor of Fieldwork- Forestry & Woodland Services. As my Mother pointed out to me, most trees were yet to be in leaf, so this made it all the more challenging, that we learnt how to identify trees from their bark and buds alone. Phil supervised our tree planting efforts at the end of the day, and the attached picture is of a little oak tree. Between us we planted 150 trees in 1.5 hours. Greatly satisfying.

Here are my identification pointers (for dummies!):
Hazel:catkins (yellow pollen) tiny red flowers like sea anemones.
Ash: black buds, green bark. Branches sweep up at tip, ie L shaped, on more mature trees.
Alder &rowan : purple buds (Rowan: fluffy buds)
Elder: White flowers. Shrub.
Blackthorn: long spikes. Hawthorn: short spikes, flowers earlier than blackthorn.
Maple: looks like elder to me! Very lined bark.
Aspen: ridged scars, pale bark, pointy brown buds.
Horse chestnut: sticky buds
Birch: gritty bark like shark skin, which is brown with white flecks.

I should also mention that the lunch was fantastic (and I am not easily impressed when it comes to food!) Overall, greatly enjoyable.

As part of the merger we are moving to Castlefield’s offices in central Manchester on 8th December. Our telephone will have a recorded message giving the new telephone number.

This event will will be the last to take place at our old offices in Didsbury.

1 The Arcade
829 Wilmslow Road
Manchester M20 5WD

Pre-Christmas gathering for clients to meet our new co-directors from Castlefield and hear about the commitment to socially responsible/ employee ownership.

 We hope to organise further events in the New Year, including in the London area.

We are delighted to tell you that GAEIA has recently merged with Castlefield, a Manchester-based investment and financial services business owned by a mix of a charitable foundation and employees/benefits trust. The ownership structure is designed for the benefit of current and future generations of clients and employees. The GAEIA name remains and we will continue to provide the same services as Independent Financial Advisors.

We will be able to spread the word about environmental and ethical investment more effectively and to more individuals, businesses and charities as a result of the merger

Brigid, Olivia and Helen will remain Directors and shareholders in the new enlarged company, along side our new senior colleagues, David Soutar and John Eckersley (the new MD) from Castlefield, who are committed to both employee ownership and the growth of ethically/environmentally responsible investment.
 

Frequently Asked Questions can be found o­n the Castlefield Website
Password: sustainability.

A decade after the launch of the ground-breaking FTSE4Good Index Series, FTSE Group, the award winning index provider, recently announced the launch of the FTSE4Good ESG Ratings. This new data service provides a comprehensive, transparent and objective system to measure the Environmental, Social and Governance (ESG) practices of over 2,300 public companies worldwide.

There is an increasing awareness that ESG factors are an important component in understanding corporate risks and performance and in the achievement of long-term, sustainable investment returns. In the decade ahead the integration of ESG factors into investment analysis, decision-making and stewardship is expected to increase.  Globally, 227 asset owners and 496 asset managers have signed up to the United Nations Principles for Responsible Investment (PRI), thereby committing to integrating ESG considerations into their investment and stewardship approaches.

The FTSE4Good ESG Ratings provide institutional investors with a flexible and granular scoring model which will enable them to understand a company’s ESG practices in multiple dimensions;

·         Overall ESG rating

·         Scores against a broad Environmental, Social and Governance pillar

·         Measurement against six ESG criteria themes including; environmental management, climate change, human and labour rights, supply chain labour standards, corporate governance and countering bribery.

The ratings are risk-relative and indicate a company’s success at managing its company-specific ESG risks. This means companies with higher ESG risks have more to achieve in order to obtain a high score.

The new FTSE4Good ESG Ratings provide a flexible tool for active portfolio management, manager selection, company engagement, risk management, company research and corporate ESG benchmarking. Active portfolio managers can use the ratings to define an eligible investment universe or apply the ratings to a propriety investment model.

Institutional investors can use the ratings to help them assess their portfolios against ESG themes and their exposure to ESG risks. As more fund managers and asset owners choose to engage with companies as part of their stewardship responsibilities, the ratings can provide them with an independent and objective measure to identify companies with whom they might engage and to track their progress.

The FTSE4Good ESG Ratings criteria are publicly available and follow clearly defined methodology and rules. To ensure their quality and accuracy they are overseen by an independent committee made up of experts from the investment community, academia, the business community, unions and NGOs. Company ratings are re-assessed twice a year by leading research provider, EIRIS.

 “With the launch of the FTSE4Good ESG Ratings we are building on 10 years of FTSE4Good index experience”

said Mark Makepeace, Chief Executive of FTSE Group.

“The new Ratings service provides an easy to use and objective measure of corporate ESG practice and risk.  Today we are also highlighting those companies that, based on our Ratings, have leading ESG practices.”

The Rt Hon Vince Cable, Secretary of State, who was a keynote speaker at the event in London to celebrate 10 years of FTSE4Good, said that

“It is crucial for investors to encourage and support long-term thinking in the companies in which they invest. To facilitate this there is a great need for a focus on broader corporate performance, rather than a narrow focus on near term financials. Environmental, social and governance considerations are an important part of this.”

Joanne Segars, Chief Executive of the NAPF, also spoke at the FTSE event tonight welcomed the launch of the FTSE4Good ESG Ratings

“Pension funds naturally have a long-term focus.  With the introduction of the Stewardship Code this is highly topical as there is a real need for good data such as this, to use in engagement and dialogue with investee companies.”

Highest scoring companies

 in accordance with FTSE4Good ESG Ratings – Global

Countries with highest scoring averages

 in accordance with FTSE4Good ESG Ratings

 The Green Investment Bank Commission recently submitted their report to government.

The driving force behind the Green Investment Bank (GIB) is that the UK needs to move to a low carbon economy within the next 40 years. The reductions already decided by government are 20% by 2020 and 90% by 2050, these both relative to 1990 levels.

 The report [ http://www.climatechangecapital.com/thinktank/ccc-thinktank/publications.aspx ] is very wide-ranging and comes up with a complete set of suggestions, many already welcomed by the broad green movement, for example http://www.foe.co.uk/resource/press_releases/green_bank_29062010.html .

 GIB is needed because of the failure of traditional funding methods and the large number of previous government initiatives. It would ensure energy security and reduce exposure to increasingly high and volatile fossil fuel prices. It is also hoped it will create lots of new businesses and jobs.

 Although GIB will look across the range of CO2 reduction methods it will focus on energy generation, efficiency and distribution because it accounts for the largest single emitter. However, in this area the UK is quite far behind in both the amount of renewable power in current use and in 2020 targets across Europe. We currently have rather more renewables than Malta and Luxemburg. Our 2020 target of 15% is behind 17 countries and ahead of only 9; it’s also behind 10 countries’ 2005 actual renewables.

 The amounts of money claimed to be required are pretty staggering. In between £800bn to £1000bn is required up to 2030 – that’s £40bn to £50bn per year. £200bn of that is needed up to 2020 just for current UK energy policy commitments.Around £550bn (£55bn pa)  is needed for the UK’s low carbon infrastructure – this is a step up from our spend of £6bn in 2009.

 Where will all the money come from? This is one of the things that will no doubt be argued over and decided politically.

• Start up capitalisation could come from the private sector banks including those owned by government, the new bank levy and bonus tax, bank sales, UK share of the EU Emissions Trading Scheme auctions [£40bn 2012-2020], sales of government owned assets.
• For grant aid it would get the money from the government as the taken over 9 quangos and funds current do. [ £2.2bn ]
• For on-going activities and investments the possible sources are capital markets, taking over the CERT levy on energy bills, GIB debt fund and the sale of externally rated Green bonds and ISAs to the public. 

Organisationally GIB will be a public body accountable to government but with commercial independence. It is suggested that its board be made up from private sector entirely. It will work closely with the banks and other financial institutions taking care intervene only when the private sector fails to. It will also take over all previous government quangos and funds that address carbon reduction. Profits from GIB will be re-invested in its core aim of reducing carbon emission.

 GIB will cover both large infrastructure investment down to individual domestic generation and insulation. If necessary it will buy completed renewables assets such as wind farms. It will provide insurance to renewables projects and underwrite long-term carbon pricing.