Giles to Foster Impact Expertise at UK Pensions
New Pensions for Purpose Director will lead project encouraging collaboration and bolstering impact investing among trustees, advisers and fund managers.
Richard Giles, newly appointed Senior Director at Pensions for Purpose, intends to create a new community for trustees, advisors and fund managers and use his industry experience to “accelerate the growing use of impact investments”.
On 1 December, Pensions for Purpose is set to launch a new ‘Community’ to encourage the sharing of knowledge. Giles told ESG Investor that there is more must be done to improve data quality, modelling and translate ESG policies into action.
“The community will be a great place for stakeholders to share, collaborate, engage and stimulate new ideas and to create a new best practice,” he added.
Giles’ initial focus at the company will be to grow the Pensions for Purpose Community, including inviting trustees, advisors and fund managers to become members. He also plans to survey the industry to ascertain its “most urgent needs” with the aim incorporating findings into the organisation’s programme of events for 2024.
He said that goals for pensions must be developed across for the sector to be successful and that he intends to “share ideas” and be part of building an “industry-wide consensus”.
“It’s an exciting time to be joining Pensions for Purpose.”
Sharing knowledge, accelerating improvements
Giles already serves as an Advisory Group Member at Pensions for Purpose, joining in March 2023, where he guides the financial services management team along with others from across the industry.
He has 30 years of experience in UK pensions, including running the Teachers’ Pension Scheme and as Strategic Partnership Director for workplace pensions provider TPT Retirement Solutions. He has also spent 11 years at Big Four consultancy firm PwC, where he was a Partner and Head of Pension Advisory services in the North.
Giles said that Pensions for Purpose acts as a “bridge” between asset managers, pension funds and their professional advisers, with the organisation’s mission to “share knowledge, best practice and accelerate improvements”.
To achieve this, the organisation runs events, researches relevant industry issues, and operates a knowledge hub.
Pensions for Purpose has a membership network of 350 organisations, with 1,200 individuals represented within its forums.
Giles said that impact investments need to become an “intrinsic part” of pension schemes’ investment process, which will need an “evolution” in the strategic processes, data gathering, modelling and performance measurement undertaken by trustees and their advisers.
“Given the financial clout of UK pension schemes, the opportunity to make a meaningful difference is attractive to me,” Giles said. “Finding the right path to a positive future is exciting.”
He also acknowledged the importance of knowledge sharing in impact investing due to there being so much new information and ideas being generated.
“[Impact investing] has a huge learning curve for trustees, advisers and managers to acquire,” he added. “Data quality is poor and translating strategy into measurable goals is in its infancy.”
Impact incentives
BNP Paribas’ recent ‘ESG Global Survey 2023’ found that impact investing has become increasingly important to investors.
The Global Impact Investing Network defines impact investing as being investments made with the intention to generate positive, measurable social and environmental impact alongside a financial return.
More than half (54%) of the 420 asset owners and managers, hedge funds and private equity firms that responded to the survey said they expect to use impact investing in the next two years versus 45% currently.
Giles suggested that that increase in focus on impact investing has partially been driven by morals, with investors “looking to their investments to support a transition to a better world for their children and grandchildren”.
“The need for change is more urgent and obvious given the extreme weather events, evidence of nature loss and the affect this is having on people worldwide,” he added.
Giles also noted that there is an investment incentive for impact investing due to a “growing concern” for investors investing in asset classes that get left behind as policy and culture shifts towards a cleaner, greener economy.
“Investors don’t want to be left stranded as the tide goes out,” he added. “There are a huge number of exciting new investment opportunities to build a cleaner, greener economy and evidence impact investments have better risk-adjusted returns.”
Giles said that the world is “changing quickly” and it is “important for UK pension schemes to reflect on this.
“We are coming to the end of the industrial age and in the next 20 years our economies will be more digital, greener and cleaner,” he added.
“The scale of investment needed to fund this transition is regularly quoted to be in excess of £2 trillion (US$2.4 trillion) annually until 2050 – this is a tremendous opportunity for pension scheme investment.”
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