14 September 2020
The significance of UBS as a major impact investor and a thought leader in the area was clearly signalled last year when it was elected by its peers to the advisory board of the IFC-led Operating Principles for Impact Management.
It believes the Principles offer a strong platform to standardise impact investing criteria and expand the universe of credible funds that enable private investors to have positive impact on people and planet without compromising financial returns.
The firm – the world's largest wealth manager - claims to have raised $4 billion from private investors in impact investing since 2017, with the commitment to reach $5 billion by 2022.
Other significant developments during 2019 included:
- strengthening its partnerships with multilateral development banks (MDBs) to – in an industry-first - offer private investors access to MDB debt instruments;
- working with leading asset managers to drive intentional positive change at public companies through shareholder and bondholder engagement, including the innovative SDG Engagement High Yield Credit funds, in partnership with Federated Hermes, that will seek to achieve meaningful social and/or environmental impact as well as a compelling financial return;
- publishing a white paper for the World Economic Forum on mobilising more private wealth towards the Sustainable Development Goals (SDGs);
- increasing the allocation to impact investing strategies in discretionary portfolios for private clients;
- launching a proprietary data-driven methodology that captures investor interest in key sustainability topics (climate change, water, pollution and waste, people, products and services, and governance) and tailors portfolios to address them. This is expected to encourage transparency and improve corporate reporting on key issues.
The firm invests in both large and small opportunities. For example, it is a major investor in Sustainable Solutions Fund III, the $1 billion impact fund managed by Generation Investment Management, and also supported the launch of Align17 – a digital marketplace for impact co-investments – to raise capital for highly impactful but smaller opportunities down to as little as $250,000.
It also runs workshops for individual clients and families on impact investing and works with academic institutions to educate the next generation of investors.