Addenda Impact Fixed Income Pooled Fund: Annual Impact Report
The 2019 Addenda Impact Fixed Income Pooled Fund impact report was shared with unit holders in July. The report gives an overview of impact investing at Addenda Capital, explains who decides which securities qualify as “impact” and covers investment performance and portfolio characteristics. It also includes examples of the Fund’s holdings for each of the 10 focus areas under the 4 themes, which are climate change: community development, education, and health and wellness. An example of an impact investment within the health and wellness theme and hospitals focus area, is Sinai Health System. Sinai Health System brings together Mount Sinai Hospital and Bridgepoint Active Healthcare and serves patients in Toronto across the continuum of care and life-course by integrating acute, complex chronic care, rehabilitative care with primary and community-based care. The annual impact report also includes example metrics for each holding in the Fund and aggregate metrics across the Fund. Notably, at the end of 2019, Addenda’s Impact Fixed Income Pooled Fund invested in clean transportation projects that reduced 137K tonnes of CO2.
Addenda Case Study included in CFA Institute Publication: “Climate Change Analysis in the Investment Process”
Addenda contributed a case study to a CFA Institute report launched in September. The case study entitled “Using climate considerations to build positive impacts into fixed-income portfolios” looks at how Addenda addresses climate change through its fixed-income investments. The CFA publication presents various case studies aimed to educate investors about climate change and its economic impacts, best practices in climate-related financial analysis, and sources of information on integrating climate change into the investment process.
PROMOTING SUSTAINABLE FINANCIAL MARKETS — RAISING STANDARDS
Recommendations Submitted to the Ontario Capital Markets Modernization Taskforce
The Ontario Capital Markets Modernization Taskforce issued 47 recommendations for market reforms for consultation. The Sustainable Investing (SI) team, with institutional investor peers, contacted the taskforce to discuss ESG-related requirements we would like to see in the market. We presented our ideas to the taskforce in the spring and collaborated with a group of institutional investors to develop input on the ESG-related recommendations and questions posed in the consultation document.
The recommendations and key comments addressed in the letter are:
- #19 Board diversity disclosure and target-setting for the inclusion of women, as well as Black, Indigenous and People of Colour (BIPOC)
- #20 Regulation of proxy advisory firms
- #23 Annual advisory vote on executive compensation
- #24 Shareholder proposal appeals process
- #25 ESG disclosure for listed companies
Supporting The Sustainability Accounting Standards Board (SASB) Globalization Initiative
SASB is conducting research to identify possible improvements to their industry standards to ensure global relevance and applicability. Addenda reached out to the equity research departments of several Canadian banks to ask if their sell-side analysts would submit feedback to SASB to help with this process.
Signed the Canadian Investor Statement on Diversity & Inclusion
Addenda became a founding signatory to the Canadian Investor Statement on Diversity & Inclusion, prepared by the Responsible Investment Association (RiA) with the input of the Sustaining Members. The Statement is focused on the role we can play, as an institutional investor, in addressing the inequities and discrimination that exist in Canada by taking intentional steps to promote diversity and inclusion across our portfolios and within our organization.
Support for the Science-Based Targets Campaign
This quarter, Addenda signed on to the CDP Science-Based Targets Campaign. Through this initiative the CDP will write, on behalf of signatories, to approximately 1,900 high climate impact issuers asking them to commit to and adopt science-based targets (SBTs) – emissions reduction targets that have been verified to align with keeping warming below 2 degrees.