Irish pensions are sitting out the pivot into climate proofing investments and are missing out as a result, expert claims

Irish pension managers have been slower than peers to shift to environmentally focused investment, and losing out as a result, according to a senior industry figure.

ublin based, environmentally focused, investment manager KBI has secured a string of new mandates understood to total in the order of €2bn as global pensions seek to shift focus to fund and benefit from businesses involved in solving environmental issues 

KBI Global Investors CEO, Sean Hawkshaw, said internationally investors including family offices and pension trustees have shifted significantly as climate change moved from hypothetical effects into real time.

“Investors might have seen this as niche or as fringe but in a lot of places especially in the US they are already having to live with the effects we were talking about 20 years ago,” he said.

President Joe Biden’s Inflation Reduction Act is a landmark piece of legislation for the sector that will draw huge investment into the US, he said.

Irish pensions funds are noticeably slow to shift investment into environmentally skewed strategies, despite a track record of returns, he noted.

Management of Irish pension funds is defensive partly because regulators are heavily focused on avoiding the kind of losses seen during the last financial crisis.

But, Sean Hawkshaw, whose firm developed a focus into investments that will support and benefit from the climate change agenda more than two decades ago, said the strategy does not mean foregoing higher financial returns.

“Irish pension funds are missing out on long term returns.”

His firm has secured a string of new mandates in recent months includes Northern Trust Asset Management, which has selected KBIGI’s Global Sustainable Infrastructure Strategy (GSIS) for inclusion in a multi-manager infrastructure mutual fund, and for distribution to its institutional OCIO clients;

Sun Life Global Investments (Canada), a distribution partner for KBIGI since 2019 has also adopted GSIS; Government of Guam Retirement Fund has awarded KBIGI a new institutional mandate as well as choosing to invest in GSIS itself and Mediolanum International Funds Limited, part of the Italian banking Group, and has selected KBIGI as co-manager for its newly launched Circular Opportunities strategy for distribution in Italy.