Asset Consultants Survey - The Climate Institute

CLIMATE CHANGE INVESTMENT INITIATIVE UPDATE – Asset Consultants Surveyclass with the highest liability. Consultants will need to increase their capabilities if theyare to capture this business from super funds.Client feedback in relation to climate change• Approximately 56% of respondents have offered climate change advice to superfunds butmost of them did not think climate change was important.• Asset consultants indicated that superfunds were split evenly managing climate changeissues with 56% of asset consultants having not had any superfund clients request forservices around climate change risks and opportunities and the remaining respondentshaving several requests.• Most respondents (78%) doubted that superfunds were prepared to pay for the necessaryresearch to adequately integrate climate change risks and opportunities into theirservices. Also, 89% of respondents were unsure as to how much more they would needto charge for this.Asset allocation and climate change opportunities• Approximately 44% of asset consultants would only advise their clients to considerimplementing climate change or carbon as an asset class depending on their portfolio orneeds and 33% would only do so at clients’ request. 11% responded that they providethis advice for all clients.• 33% of respondents thought that climate change risk should be partly managed viaspecific allocations in the asset allocation strategy (either through investments across allor specific asset classes). A majority (78%) did not believe that there was a certaindesirable range of portfolio that should be allocated to climate change related assets.• Most of the asset consultants (67%) had not provided any advice to clients on investingcollectively in climate change opportunities.• 33% of consultants use specific research from third parties to assess climate change risk.Capacity and capability for dealing with climate change• While asset consultants are still in their infancy in managing climate change issues, mostof the respondents (78%) had sufficient staff to deal with climate change issues withslightly more than half (56%) having a specific executive responsible for dealing withclimate change issues or client advice in the area.. Approximately 80% were planning tofurther increase their capacity through internal and external measures.Implications for investment managers• Only 11% of respondents currently do not integrate climate change risks andopportunities to any degree into the rating and selection of fund managers• Approximately 56% of consultants would not advise their clients to restructure eitherexisting or new mandates to account for climate change risks and opportunities• Majority (67%) of respondents believed that longer term incentives for fund managerswould assist superfunds in managing long-term risks.PAGE 6CLIMATE CHANGE INVESTMENT INITIATIVE UPDATE – Asset Consultants Survey