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Writer's pictureMathew Jensen

Values-investing: is manager reporting up to snuff?

What is the state of values-based investment reporting, is it part of the solution to bringing sustainable investing to the masses, or does it fall short? And is this latest report just another example of a large, complex financial institution and public company balancing many stakeholders?


The world’s largest asset manager (at US$9 trillion – that’s roughly two Germanys of annual GDP), US-based Blackrock is out with their annual Global Impact Report from their equity investing team, and there are interesting learnings from an organization that may touch or influence your assets directly or indirectly.


On seeking impact and seeking financial returns, an interesting point:

  • ‘We operate at the intersection between seeking measurable, positive and additional, environmental and social outcomes, and seeking long-term total financial returns. Without both in combination, the world is less likely to amass the capital required to tackle global challenges’.

On investing in public companies versus private companies:

  • ‘We believe if an impact company can flourish in public markets, it can serve more communities in unaddressed markets and keep innovating to advance technologies targeted at reducing the damage to the planet caused by humans and industries’.

Blackrock focuses impact on 10 ‘themes’ that could be loosely associated with groups of UN SGDs (and are helpfully mapped in the report), with ~50% of impact assets invested in ‘public health,’ ‘financial & digital inclusion’ and ‘green energy’ themes.


Each theme is detailed in the report, with ‘why’ that theme was chosen, the associated theory of change and a company example representative of the theme.

However, like other asset manager impact reports, it’s otherwise short on data and assessable reporting.


For example, company engagement is referenced as important --- ‘We depend on engagement to help an investee get back on track. However, if we ultimately determine that such is not possible, we may need to divest’. --- and while Blackrock presents several company engagement examples, along with company investment examples, there are no engagement statistics or summary activity reporting (like what ICCR recently released). The report also lists the many impact and sustainability frameworks, networks and partnerships they engage (a ‘partial list’ on page 55 shows 28!), but no examples or reporting on why or how these organizations contributed to their investment activities and impact outcomes.

Reporting is coming into focus for FaithInvest, as I know for some of you. As described in our soon to be released update to Good Intentions, just 43% of faith-based asset owners (FBAOs) define the type of reporting they produce and require from their investment managers. A current project we’re doing with one FBAO focuses on this very issue: defining the reporting required from their asset managers to have assurances that investment policy and guidelines are manifest in the manager’s investments.

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