Pension fund picks environment adviser

THE National Pension Reserve Fund has appointed Hermes Equity Ownership Services to advise it on environment and corporate governance issues.

The fund, which invests in 2,250 companies worldwide, said the appointment of Hermes was in response to its membership of the UN-backed Principles for Responsible Investment.

The principles were drawn up by former UN secretary-general Kofi Annan.

Under its guidelines members could divest of their holdings in black-listed companies who have dealings with rogue governments or companies with poor environmental records. As an investor in so many companies the pension fund said it acknowledged that environment, social and governance issues can materially affect long-term investment performance.

Michael Somers, chief executive of the National Treasury Management Agency which oversees the fund, said: “Exercising shareholder responsibility through corporate engagement and proxy voting offers the best chance of influencing company behaviour and enhancing value, particularly for large institutional investors with a long-term investment horizon like fund.

“This appointment will help The National Pension Reserve Fund become a more engaged shareholder in the companies in which it invests.” Hermes is one of the largest fund managers in the world with more than €100 billion in assets under management. It was chosen after a public tender.