In this video Marcel Jeucken, Managing Director Responsible Investment for the Dutch pension fund PGGM, discusses how PGGM makes its investment decisions, integrating environmental, social and governance (ESG) concerns into its investment strategy. “We are big institutional investors that deploy capital into the economy, and we have to think about how we do that,” he says. One crucial element the industry is currently missing: a way to prove the societal, as well as the financial return in socially responsible investments.
Marcel Jeucken says that PGGM’s approach to SRI investment is based on two considerations: the first is the values of its clients. This is where the ‘don’t’s of PGGM’s investment strategy are found. “For example, we don’t want to invest in companies involved in humans rights abuses,” he says. PGGM’s SRI ‘do’s’ are “not in the traditional domain of the investment universe,” he says, because “you have to look a little farther ahead to see opportunities.” These opportunities include investing in renewable energy, sustainable forestry, or investing in such companies as Clean Tech Private Equity.
The dual objective of the company’s investing, says Jeucken, is to have both good financial return and good societal return. “We’ve been quite good at demonstrating what the financial return is, but as an organisation — and an industry — we are not yet good at demonstrating what the societal value of what we’re doing.” So PGGM is engaged in a research project with Erasmus University in the Netherlands “to develop a methodology in which we can demonstrate what the societal value of these investments really is.”
This video interview was recorded in New York City on 13 December 2011 during the ESG USA 2011 Conference “Investing for a Sustainable Economy,” organized by the Responsible Investor in association with Bloomberg.