Financial Investment News: Investors Seek Consultant Partnerships To Manage Market Volatility
Pensions & Investments: Investors Getting Better Ways to Gauge Risk-Parity Success
Data Show Investors Value Collaborative, Long-Term Consultant Relationship - NEPC
International Business Times: Emerging Markets Have Left Pain Behind, Positioned To Outperform: NEPC
The New York Times: How to Avoid the Next Real Estate Downturn
Frans and Caroline Swaalf, management consultants in the Netherlands, have been enamored of South Florida since they were graduate students at the University of Miami in the 1990s.
When the housing crisis hit in 2007, they thought their time to buy had come. They bought a condo in the Fontainebleau, a resort in Miami Beach, in 2010, after prices had bottomed out, paying 60 percent less than it had sold for two years earlier. The condo has since doubled in value.
The Swaalfs began investing in other properties. In 2011, they bought a small condo in an Art Deco building and doubled their money when they sold it six years later. They put that money into a larger condo in Miami that overlooked the water, and then looked for a buyer. But Mr. Swaalf expects to make only 5 to 10 percent when the sale closes.
That was a signal to the couple that the market was slowing and that it was time to put their investment gains elsewhere. Prices in the Miami area have cooled since September, according to Trulia, a real estate search engine.
Pensions & Investments: Sponsors See Proposals as Low-Priority Item
When defined contribution sponsors contemplate lifetime income solutions, their actions — or more likely, inactions — resemble the ERISA version of the film "Groundhog Day."
Pensions & Investments: Risk-Parity Investors do a bit of Second-Guessing
A cadre of asset owners are suffering from a crisis of confidence in their risk-parity investments.
The Chronicle of Philanthropy: How Stock Volatility Could Take a Swipe at Charitable Giving and Grant Making
NEPC Unveils ESG Ratings to Help Institutional Investors Differentiate Environmental, Social and Governance Approaches
NEPC, LLC, one of the industry's largest independent, full-service investment consulting firms, today announced a formalized Environment, Social and Governance (ESG) rating system using a combination of qualitative and quantitative measurements to provide an overall ESG integration score. The rating system has been in development over the last year in a joint effort among NEPC's Impact Investing Committee, its Research Department, and select clients. The system was developed in response to the continued interest across NEPC's client base to understand how investment firms are approaching ESG integration, as well as key characteristics that differentiate the best approaches in today's market.
NEPC's ESG Rankings are determined using a combination of qualitative research, such as one-on-one interviews with investment managers, at both the firm and the product level, and a quantitative rubric system measuring firm and product attributes. The score is calculated by evaluating the ESG commitment, resources and process, producing a scaled outcome from one to five where one is categorized as the best. Unlike other rating metrics, the NEPC process offers flexibility, focusing on the commitment of individual products as well as the overall firm, which can result in different outcomes for products under the same firm. What's more, the system offers the ability to rate products across different asset classes, allowing investors to gauge them based on their specific use case.
"With an extensive knowledge of the materiality of ESG already present within NEPC, we are excited to unveil a ratings system," says Mike Manning, Managing Partner at NEPC. "This approach, along with the team dedication of this project, will provide clients with advanced intel, identifying the nuances of ESG integration across asset classes. Ultimately, this will allow clients to have informed discussions about the commitment of ESG integration within their existing portfolios and of future additions to portfolios."
One of the advantages to this approach is that ratings can be updated on a continual basis, by constantly considering new developments in the industry, and enhancements introduced by investment firms. The scores will ever be evolving by using an exchange of information allowing the same process to be used across asset classes and managers. NEPC believes this method will give clients new tools and resources to help evaluate their portfolios most effectively.
This update comes after extensive research and formalizes, expands and quantifies a process NEPC has honed over the past several years. NEPC has long incorporated ESG information into manager search books, due diligence memos and other materials.
The new rating system launched in 2018 and will roll out in waves across NEPC's preferred lists.
About NEPC, LLC
NEPC, LLC is an independent, full service investment consulting firm, providing asset allocation, manager search, performance evaluation, and investment policy services. We work with institutional investment programs and private wealth clients on both an advisory and discretionary basis. We service 362 retainer relationships, representing assets of $1.0 trillion1 with approximately $62.0 billion2 in alternative assets, from our offices in Atlanta, Boston, Charlotte, Chicago, Detroit, Las Vegas, Portland and San Francisco.
1 As of 9/30/2018, includes 51 clients with discretionary assets of $17.7 billion.
2 As of 6/30/2018
The NonProfit Times: Endowment Managers Don't Expect Much In 2019
More than 50 percent of endowment and foundation managers are bullish on private equity (PE) investments while the vast majority of those surveyed expect domestic equities to be relatively flat or will taper off this year, returning single digits.