KGAL Group – a leading Independent investment and asset manager – has signed up to the Principles for Responsible Investment, underlining the company’s commitment to enacting social responsibility through the implementation of tangible measures.
KGAL’s investments in Real Estate, Aviation and Renewable Energies take into account social trends such as urbanisation, clean energy and resource-efficient mobility. Sustainability criteria are becoming increasingly important in the selection of investments. Gert Waltenbauer, CEO of the KGAL Group, explains: "Sustainability is a strategically relevant topic. It helps us to better recognise and control opportunities and risks." Before signing, KGAL participated in a comprehensive consultation process, in which all aspects of environmental, social and governance (ESG) topics were analysed. The PRI define guardrails that are increasingly relevant for investors. According to CEO Waltenbauer, sustainability management represents a tool that enables KGAL to fulfil its responsibilities to its customers and society in general.
Financial industry has to integrate ESG at all levels of operation
KGAL Group discussed with a group of institutional investors how to best achieve ESG integration. Tim Van den Brande, Senior Director, KGAL Capital GmbH & Co. KG, emphasized two steps in a discussion at London Stock Exchange. "The first step of ESG integration is ensuring that the firm’s culture, as well as the strategic and operational management’s objectives are aligned." Furthermore, Van den Brande states that ESG information has to be integrated into the investment decision-making process to complement the risk-return analysis.
The UN PRI sets out the following six principles:
1. "We will incorporate environmental, social and governance (ESG) issues into investment analysis and decision-making processes.
2. We will be active owners and incorporate ESG issues into our ownership policies and practices.
3. We will seek appropriate disclosure on ESG issues by the entities in which we invest.
4. We will promote acceptance and implementation of the Principles within the investment industry.
5. We will work together to enhance our effectiveness in implementing the Principles.
6. We will each report on our activities and progress towards implementing the Principles."
The UN Principles for Responsible Investment (UN PRI) is an investor initiative that was established in 2006 by the United Nations Environment Programme Finance Initiative (UNEP) and the UN Global Compact in partnership. This UN-backed initiative is an international network of investors (source: www.unpri.org).