CONTACT THE EAPF

Contact us

You can get in touch with us through
the following methods.

0800 121 6593
      The Environment Agency Team

     Capita
     11b Lingfield Point
     Darlington
     DL1 1AX

Climate change

We recognise that climate change is a material financial risk for the Fund, but it also presents opportunities, such as investing in clean technology.

The diagram below illustrates our strategy to minimise the long term impacts of climate change on the Fund value. We have been taking action on this over the last decade. More detail on our research, reports and strategy going forward are also available on our website.

 

Industry/ Public Advocacy Funding Strategy Strategic Asset Allocation Investment Strategy Design Mandate Tendering Fund Manager Selection Risk Assessment Risk Management Reporting And Disclosure

Industry/Public Advocacy

  • Monitoring of corporate environmental disclosures by listed companies
  • Environmental reporting guidance
  • Carbon neutrality and offsetting report
  • UNPRI / IIGCC active participation through policy and technical groups
  • Collaborative engagements

Funding Strategy

  • Looking to reduce all risks to funding strategy
  • Long term investment horizon linked with impact of climate change risks
  • Seen as key element of fiduciary duty
  • Viewed as a material long term risk to the fund

Strategic Asset Allocation

  • Partner climate change asset allocation study – Mercer analysis (scenarios)
  • Appreciation that this affects all asset classes
  • Increase exposure to ‘climate-sensitive’ assets

Investment Strategy Design

  • Increase in ‘real assets’ - including forestry, sustainable property & infrastructure
  • Diversifying across sources of climate risk
  • Target of 25% of fund in sustainable investments including clean-tech

Mandate Tendering

  • Link to financial performance
  • Demonstrate level of integration of environmental, social and corporate governance (ESG)
  • Level of expertise / team resources in ESG
  • Voting & engagement capability and proven track record of success
  • Willingness to partner on research

Fund Manager Selection

  • Portfolio construction
  • Relevant best practice ESG standards for asset class
  • Transparency of policies and practises· Ongoing monitoring and reporting
  • Advocacy & responsible investment / ESG research
  • Working in partnership to engage with underlying companies

Risk Assessment

  • Portfolio footprinting
  • Portfolio carbon risk analysis
  • Geographical analysis
  • Sectoral analysis
  • Fund manager risks
  • Exposure to fossil fuels

Risk Management

  • Tailored EAPF engagement plans
  • Review investment strategy to maximise returns and minimise risks
  • Look at barriers to effective implementation of strategy e.g. inappropriate benchmarks
  • ESG integrated within performance matrix

Reporting And Disclosure

  • Statement of investment principles
  • Responsible Investment Review (all asset classes and case studies from managers and advisors)
  • Annual report and accounts
  • Voting guidance on environmental issues

 

A B C D E F G H I

Industry Public Advocacy

  • Monitoring of corporate environmental disclosures by listed companies
  • Environmental reporting guidance
  • Carbon neutrality and offsetting report
  • UNPRI / IIGCC active participation through policy and technical groups
  • Collaborative engagements

Funding Strategy

  • Looking to reduce all risks to funding strategy
  • Long term investment horizon linked with impact of climate change risks
  • Seen as key element of fiduciary duty
  • Viewed as a material long term risk to the fund

Strategic Asset Allocation

  • Partner climate change asset allocation study – Mercer analysis (scenarios)
  • Appreciation that this affects all asset classes
  • Increase exposure to ‘climate-sensitive’ assets

Investment Strategy Design

  • Increase in ‘real assets’ - including forestry, sustainable property & infrastructure
  • Diversifying across sources of climate risk
  • Target of 25% of fund in sustainable investments including clean-tech

Mandate Tendering

  • Link to financial performance
  • Demonstrate level of integration of environmental, social and corporate governance (ESG)
  • Level of expertise / team resources in ESG
  • Voting & engagement capability and proven track record of success
  • Willingness to partner on research

Fund Manager Selection

  • Portfolio construction
  • Relevant best practice ESG standards for asset class
  • Transparency of policies and practises· Ongoing monitoring and reporting
  • Advocacy & responsible investment / ESG research
  • Working in partnership to engage with underlying companies

Risk Assessment

  • Portfolio footprinting
  • Portfolio carbon risk analysis
  • Geographical analysis
  • Sectoral analysis
  • Fund manager risks
  • Exposure to fossil fuels

Risk Management

  • Tailored EAPF engagement plans
  • Review investment strategy to maximise returns and minimise risks
  • Look at barriers to effective implementation of strategy e.g. inappropriate benchmarks
  • ESG integrated within performance matrix

Reporting And Disclosure

  • Statement of investment principles
  • Responsible Investment Review (all asset classes and case studies from managers and advisors)
  • Annual report and accounts
  • Voting guidance on environmental issues