Name: Matt Christensen
Title: Global Head of Sustainable & Impact Investing
Organization: Allianz Global Investors
ESG Topics of Interest:
- The shift from risk mitigation to impact investing
- ESG connection to the SDGs
- Developing ESG standards for private markets
What motivated you to join the GRESB Foundation Board?
My motivation stems from my keen interest in seeing ESG adoption in private markets happen quickly while maintaining high integrity around content and practices. I have monitored GRESB since its inception and firmly believe it is the best initiative in the market to help facilitate a pathway to ESG integration in private market investing.
As a Foundation Board Member, I hope to bring my expertise from a twenty-year track record of working in sustainable investing – from my initial entry into the field as the Founding Executive Director of Eurosif to my experience as the Head of Responsible and Sustainable Investing in global asset management companies. In my current role at AllianzGI, I am responsible for guiding the ESG integration strategy in our private market assets and I hope to use this experience to help GRESB further expand to other asset classes such as private equity where I believe the organization could play a key role.
How does your organization view ESG and what is your organization’s approach to responsible investing?
A pioneer in responsible and sustainable investing since 1999, AllianzGI has a long pedigree in ESG-related research and investing. We were among the first fifty asset managers to sign the PRI in 2007.
As a baseline, all of our strategies assess ESG risks. We have a rigorous approach to ESG integration for mainstream strategies through our “Integrated ESG” approach, which focuses on material ESG risks. AllianzGI also provides a range of ESG risk-focused and sustainability product categories, adaptable to different levels of ESG incorporation and client preferences, with a combined AUM of over EUR300 billion as of December 2021.
We believe private markets can act as an important lever for change towards a more sustainable world. Specifically, the due diligence process for private market investments, which entails the collection of detailed information and allows us to influence the terms of the investment and improve ESG practices, facilitates the integration of ESG risk analysis from the very beginning. ESG integration also provides the ability to focus on investing in real economies, identifying and incubating future important themes and playing a collaborative role in engaging with corporates on key sustainability targets.
How does your organization use GRESB and its data?
Our Direct Infrastructure Equity team has a number of portfolio companies reporting to GRESB and they continue to work to encourage other portfolio companies to become GRESB participating assets. The team also collaborates with GRESB through various platforms to facilitate the integration of ESG data regulatory requirements into the infrastructure sector.
Most recently, our Infrastructure Debt team has been working directly with GRESB on how it might leverage the collected data. This team also has a representative on the GRESB Infrastructure Debt Working Group and has joined a small consortium of key infrastructure debt players to develop a legal standard to incorporate the principal adverse impact (PAI) indicators into our legal documentation. Once published, this will have a major impact on our investment practice in terms of the ESG data that we have available. Without GRESB convening these parties this effort would not have been possible.
What is next for ESG and what role will organizations like GRESB play going forward?
AllianzGI and its private equity house Allianz Capital Partners have long felt the need for better ESG standards in private markets. We have continuously tracked GRESB’s initiatives as the organization expanded its focus from real estate to infrastructure and we would welcome additional expansions to its scope.
There are also a number of other industry initiatives supporting this goal, such as the Climate Finance Leadership Initiative, and activities of industry bodies such as ILPA, LTIIA, IPFA, and PPiA. A challenge will be to ensure that these initiatives do not take the industry down different paths. Convergence across sectors and asset classes will be important to create scale.
This convergence will also help increase the availability of ESG data that informs our decision-making and engagement with our investments. We find that whilst improving, our investments are still struggling to provide the full and timely transparency that we would like and that is becoming increasingly required from a regulatory perspective. This is particularly true in the private credit markets, which, given their position in the corporate structure, struggle to receive the level of information they desire. Collaboration between the equity and debt industries will help push the market in the right direction.