IAR Americas: US investors grappling with concept of social investing

Channels: Sustainability, USA focus

Companies: Zurich, Transamerica, Impact Community Capital

People: Danielle Brassel, Maurice Perkins, Jeff Brenner

US insurance investors are still working out the definitions of social investing and how to implement it as a cohesive policy across asset classes, even as the other two legs of the environmental, social and governance acronym have developed further in recent times.

“The market has not yet found a very clear and specific definition for social investing, although there are various operating principles for managing impact,” Danielle Brassel, responsible investment analyst at Zurich, said. “Organisations are still discussing this issue, looking at what asset classes are impacted by social investment as such.”

Maurice Perkins, global head of Aegon Transamerica's government and policy affairs team, said the development of social investing in the US remains embryonic.

“There are no hard and fast policies yet with regards to thresholds or annual amounts of investments, for example,” Perkins said. “It is perhaps a laggard compared to the environmental and governance parts of ESG.”

The thought was affirmed by Jeff Brenner, chief executive of Impact Community Capital, who feels the US is still behind Europe in its move to social investing. He said that prime concern for social investors—as for all asset managers—remains to make returns off their investments—with a social function layered on top of that.

“In the US, social investing is referred to as impact investing—but what we talk to investors about is the investment part first and foremost,” Brenner said. “After that it is thinking about it in terms of investing with a purpose—and then it's really up to the manager or the asset owner to decide what they want that purpose to be.”

A panel discussion “Investing for social good” will be held at the Insurance Asset Risk Americas conference which will take place on 22 and 23 of September. This year's event will be held as a virtual conference due to COVID-19. More details can be found here.

Sarfraz Thind