“Most asset managers committing to impact investing have traditionally been small and specialised. The world’s challenge – and the investment industry’s opportunity – is that the capital requirements for sustainable economic outcomes are neither small nor specialised, with a funding gap estimated by the UN of US$4.2 trillion per year to meet the SDGs.” — Peter Harrison, Group Chief Executive, Schroders.
UK asset manager Schroders has released its first group-wide Impact Report, outlining its impact investing efforts across various asset classes, including public and private equity, infrastructure and real estate.
The report highlights how the Schroders’ Impact Framework measures and reports on the outcomes of its impact strategies, including contributions to the UN Sustainable Development Goals and climate performance.
The release of the report follows the acquisition by Schroders — which held £750.6 billion (US$970.4 billion) in AUM as of February 2024 — of impact investing pioneer BlueOrchard Finance Ltd in 2019 and resulted in the development of its Impact Framework.
The Impact Framework consists of three core pillars — impact management, impact measurement and monitoring, and impact governance — to ensure investments will deliver positive social and environmental outcomes, alongside financial returns.
Schroders selected five overarching impact themes – inclusion, health and wellness, environment, responsible consumption and production, and sustainable infrastructure — seeking to align with the UN Sustainable Development Goals (SDGs) and respond to critical global challenges.
Spanning public and private equity and debt, infrastructure, real estate, fund of funds and multi-private asset solutions, the framework allows for the measurement and monitoring of impact at scale, and with a consistent and rigorous process.
The co-creation of Schroders impact investing strategies and its respective investment teams has ensured full alignment in terms of impact objectives, has changed the asset manager’s investment processes to embed impact at every stage, and are ambitious in both monitoring and reporting impact achievements.
Over the last five years, Schroders has applied its Impact Framework to all 20 of its impact funds, which represent some US$5.25 billion in AUM across Schroders, Schroders Capital and BlueOrchard, investing in companies, funds and assets that support 504,646 people.
To view Schroders’ full Impact Report click here.