Insto roundup: Aussie supers dinged for climate voting records; Cathay Pacific gets land bank bailout
Eight major super funds have been criticised for voting against the majority of shareholder proposals on climate change at recent annual general meetings despite being members of an investor group pushing for companies to act on climate risks.
AMP, AustralianSuper and First State Super are among the funds singled out in a report by the Australian Centre for Corporate Responsibility (ACCR) for voting down more than half the climate-related shareholder proposals over the past three years.
"The issue here is – is there a difference between what funds are telling their members and what they’re actually doing? If they’re saying they’re active owners and their voting behaviour says something different, that is a real concern," ACCR climate director Dan Gocher said.
Source: The Sydney Morning Herald
AustralianSuper picked a 25% stake in property developer Assemble Communities and will invest in the latter’s pipeline of projects. The country's largest superannuation fund did not disclose financial terms of the investment.
“This investment will enable us to grow our innovative ‘rent with the option to buy’ property portfolio, known as the Assemble Model, which addresses housing affordability and access to homeownership. Over time, the investment will support us to deliver build to rent assets,” Assemble said in a statement.
Source: Deal Street Asia
Construction industry superannuation fund Cbus is to appoint a new head of infrastructure, hiring from rival super outfit AustralianSuper. The super fund is understood to be set to name Alexandra Campbell in the role, bringing her over from AustralianSuper, where she worked as a senior investment director.
She would fill the shoes left by Diana Callebaut, who was Cbus's head of infrastructure before moving to the NSW Treasury Corporation earlier this year.
Source: The Australian Financial Review
Superannuation funds say the A$3 trillion ($2 trillion) sector needs policy stability to take up the government’s call for more retirement money to be invested in major infrastructure projects.
The federal government is looking at ways to boost job creation through major national projects including infrastructure development. Vicki Doyle, chief executive of Rest, a super fund that invests A$8 billion in local infrastructure assets, said such assets were "perfect" for long-term economic growth and fund returns. But she warned policy uncertainty could stop funds taking part in the recovery.
Australia’s pension industry was recently hit by the government's introduction of a scheme allowing workers facing financial hardship due to the pandemic to withdraw A$20,000 from their retirement savings
Source: The Sydney Morning Herald
China Pacific Insurance launched a London listing on Friday (June 12) to raise up to $2.15 billion, reviving a scheme to build investment links between the two countries after a series of delays.
CPIC aims to list just over 113 million global depositary receipts on Tuesday (June 16). Part of the funds raised will be used for investment, said the insurer.
Source: Deal Street Asia
The Hong Kong government has offered cash-strapped Cathay Pacific a HK$27.3 billion ($3.52 billion) lifeline, which will be funded by the government’s land fund.
The land fund, which has an outstanding balance of HK$220 billion, was established for holding the land premium income for the Hong Kong government. The Hong Kong Monetary Authority is responsible for its investment management.
The investment into Cathay Life will comprise preference shares with detachable warrants of around $19.5 billion and a bridging loan of about $7.8 billion. At present, about 40% of the land fund is allocated to the investment portfolio of the city’s Exchange Fund.
Source: Asia Times, Hong Kong government
A consortium of Korean public pension funds supported a bid by the Alberta Investment Management Company and KKR to buy a 65% stake in the Coastal GasLink pipeline to Alberta, one of Canada’s most controversial industrial projects.
The deal, which closed on May 25 for an estimated $600 million, unlocks the rest of the money needed for Coastal GasLink’s construction. A consortium of 27 domestic and international banks agreed to fund the $6.6 billion cost, but only once Canada's Alberta Investment Management Corporation and KKR’s purchase signalled the pipeline was a worthy investment.
Seller TC Energy retained a 35% stake in the project and it offered to sell another 10% stake to First Nations that have signed agreements with Coastal GasLink. TC Energy is still responsible for building and operating the pipeline.
Source: The Narwhal
South Korea's government will employ the state-run debt clearer Korea Asset Management Corp (Kamco) to buy assets of financially distressed companies, and it will invite other investors such as private equity firms and pension funds as it aims to raise up to W6 trillion ($4.94 billion).
The government has also earmarked W50 billion in the W35.3 trillion third extra budget bill still pending in parliament to back Kamco’s capital increase.
Doosan Group as well as aviation and auto parts companies in the country are likely to be among the first beneficiaries. Debt-laden equipment maker Doosan Heavy Industries & Construction received a state bailout of W3.6 trillion and has since been seeking to divest its assets, but with little progress.
Source: Pulse News
The Employees Provident Fund (EPF) recorded a gross investment income of RM12.16 billion ($2.84 billion) for the first quarter ended March 31, in what has been an exceptionally challenging period due to the Covid-19 pandemic.
EPF chief executive Tunku Alizakri Alias said the pandemic had had a massive impact on an unprepared world, with lives being forever transformed and economies crashing to unprecedented levels.
“This happened on the back of an already weak global environment characterised by extremely low oil prices and market volatility from uncertain and unpredictable geopolitical issues ongoing since 2019,” he said in a statement on June 13.
Source: Malay Mail
Payments that have already been made for the annual Islamic pilgrimage this year will be fully refunded into the pilgrims' Tabung Haji (TH) accounts. In a statement on June 11, TH said the amount would also be eligible for this year's profit distribution.
"TH asks that all future pilgrims to accept this decision and pray that things go back to normal and for haj to resume next year," it said.
TH chief executive Nik Hasyudeen Yusof said the decision to defer pilgrimage for 31,600 Malaysian pilgrims showed the government's concern for the safety and well-being of the people.
Source: New Straits Times
Ahmad Zulqarnain Onn, currently deputy managing director at Khazanah Nasional, has surfaced as the front runner to replace Jalil Rasheed as chief executive of Permodalan Nasional Berhad (PNB), should the latter step down as head of the country's largest asset management company.
Sources said that Ahmad Zulqarnain's name is being bandied about, but the appointment is pending PNB's board meeting in coming week to decide whether Jalil, who has held the post for barely eight months, will stay on to steer PNB.
"He [Ahmad Zulqarnain] is the front runner. He is experienced and knows the local landscape pretty well," one source said.
Source: The Edge Markets
Abu Dhabi Investment Authority will invest $752 million in Jio Platforms, joining a list of marquee investors backing the digital arm of India’s Reliance Industries. The Gulf’s biggest sovereign wealth fund will acquire a 1.16% equity stake in a deal that values the Indian telecoms and digital services group at $65 billion.
It is the seventh investor to back the digital arm of Ambani's Reliance Industries, since Facebook invested $5.7 billion in April. Others include US private equity firms Silver Lake, Vista Equity Partners, General Atlantic and KKR, as well as Abu Dhabi's Mubadala.
The Financial Times previously reported that Saudi Arabia's Public Investment Fund is also in talks to invest about $1.5 billion in the company.
Source: Financial Times
Temasek and other investors, including Warburg Pincus and March Capital Partners, have committed Rs3.25 billion ($42.8 million) to the CarTrade Group, an online automotive group in India.
The company plans to use these funds for its expansion into the auto finance space and to invest into companies in the automotive space..
INTERNATIONAL (EXCLUDING ASIA)
An unnamed Dutch institution committed $65 million to Nuveen Real Estate’s Asia Pacific Cities strategy, taking the fund’s total assets to $650 million following its launch at end-2018.
The US asset manager did not identify the Dutch backer, but Netherlands pension fund managers APG and Bouwinvest each indicated to Mingtiandi that they were not the source of the funding.
Multiple requests for comment to PGGM, which manages €268 billion ($302 billion) of Dutch retirement money, went unanswered on June 14.
Dutch pension fund manager APG Asset Management has shown interest in acquiring a 51% stake in Tata Power’s renewable energy infrastructure investment trust (Invit), said two people aware of the development.
Others who have shown interest in the proposed Invit are private equity firm Actis and Canadian pension funds Ontario Municipal Employees’ Retirement System, Canada Pension Plan investment Board and Caisse de depot et placement du Quebec.
Invits are trusts that manage income-generating infrastructure assets, typically offering investors regular yield and a liquid method of investing in infrastructure projects.
Norway’s $1 trillion oil fund is sharpening its focus on corporate governance and the role of the board during the coronavirus pandemic but has postponed several sustainability projects amid the crisis.
Carine Smith Ihenacho, chief corporate governance officer at the world’s largest sovereign wealth fund, said that it wanted to be supportive of the 9,000 companies it invests in as they deal with the shock from Covid-19 but that it believed a focus on the composition and effectiveness of boards was more important than ever.
The oil fund is one of the world’s most important investors, owning on average 1.4% of every listed company worldwide.
Source: Financial Times
Data from the Organization for Economic Co-operation and Development (OECD) showed that pension fund assets in OECD countries rose to $32 trillion, while 29 selected non-OECD countries reported $700 billion in 2019.
The US had the largest amount of pension fund assets, with $18.8 trillion. The UK came next with $3.6 trillion, then Australia with $1.8 trillion, the Netherlands ($1.7 trillion), Canada ($1.5 trillion), Japan ($1.4 trillion) and Switzerland ($1 trillion).