Head of Sustainable Ownership, RPMI Railpen
and Judge, BVCA Excellence in ESG 2021
We also know that the climate transition represents a significant investment opportunity in areas such as electrification, infrastructure, and energy efficiency. Arguably, private market investors are well-placed to capitalise. According to the IEA (International Energy Agency), annual investment in low-carbon technologies in end-sectors (building retrofits, changing industrial processes, energy efficiency measures) could rise from $530bn to $1.7tn in the next nine years.
Companies and investors have begun to announce ambitions to become net zero emissions businesses. My organisation, RPMI Railpen, recently launched our Net Zero Plan, which outlines how we intend to meet our net zero goals, along with the analysis that supports our targets. As a pension provider for workers in the UK rail sector, we believe our Net Zero Plan goes hand in hand with our fiduciary duty and our purpose of securing our members’ futures.
No doubt, like many of our fellow BVCA members, we are also reacting to increasing disclosure requirements, such as the TCFD (Taskforce on Climate-related Financial Disclosures) and increasing attention on the disclosures we make. I doubt we have yet seen ‘peak disclosure’, as I think interest in climate issues is far from saturation.
From our perspective as an LP, climate risk and opportunity can influence our capital allocation decisions. The quality of a manager’s climate strategy is a factor in our assessment of potential GPs, as well as how we can support them in achieving this objective. We also assess financially material climate risks in the course of our co-investment due diligence. We have seen increases in sophistication and collaboration from the GP community, particularly in the UK. This helps us to meet our climate goals and deliver better outcomes to our members.
We meet many GPs and private businesses with an impressive story to tell on climate change. We see just as many examples of year-on-year improvement in climate or in ESG generally. As a returning judge of the BVCA Excellence in ESG Awards, it would be great to see this reflected in the applications we receive in 2021. Though broader than just climate change, the Excellence in ESG Awards would be a great place to showcase the work you have done and the progress you have made. Echoing Maria Carradice’s excellent call to arms, we look forward to receiving your submissions before 16 September.
Michael Marshall is Head of Sustainable Ownership at RPMI Railpen (“Railpen”). As a member of Railpen’s Fiduciary Leadership Team, Michael is accountable for integrating environmental, social, and corporate governance (ESG) factors into the fiduciary and investment management to support the scheme’s mission to pay pensions securely, affordably, and sustainably.
Before joining Railpen, Michael held various senior roles in pensions, asset management and ESG advisory. He is a member of advisory groups at the British Venture Capital and Private Equity Association (BVCA), the Financial Reporting Council (FRC), the Occupational Pensions Stewardship Council (OPSC), and the Institutional Investors Group on Climate Change (IIGCC). He studied economics at Bristol University.
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