Irish Life Investment Managers (ILIM) is a Dublin-based asset manager which has participated in five cycles of CDP’s Non-Disclosure Campaign (NDC). For ILIM, the NDC is an opportunity to combine their voice with like-minded investors, emphasizing that disclosure is an important first step to drive environmental action and is a practice they wish to see from all investee companies.
Using data to meet core objectives
Sustainability considerations are an important facet of ILIM’s investment practices. “ILIM’s purpose is to manage the assets entrusted to us by our clients responsibly, with the objective of delivering long-term sustainable returns in line with our clients’ mandates. We pursue the integration of sustainability factors in our investment processes in order to help meet that purpose, where applicable,” says Niall O’Leary, Chief Sustainability Officer at ILIM.
Disclosure and data from investee companies is an important input that informs ILIM’s investment and stewardship activities. “ILIM takes action to incorporate environmental, social and governance factors within our investment and stewardship practices,” O’Leary explains. “Our aim is to invest our clients’ assets in a way which meets our responsibility to our clients. We consciously do this across the variety of asset classes in which we invest our clients’ capital and we do so in a way that evolves to developing client needs”.
Driving positive results
ILIM has seen positive results from the NDC. Some companies they engaged with have disclosed through CDP for the first time, whilst others have expanded their disclosures to environmental issues beyond climate.
For example, Mincon Group Plc (“Mincon”), an Irish company specializing in the design, development, manufacture and service of hard-rock drilling solutions for applications, was selected for engagement as part of ILIM’s direct outreach with Irish companies on the topic of environmental disclosures. “The engagement objective was for the company to disclose to the CDP Climate Change Questionnaire since we believed this would help de-risk the business’s future operations,” explains Thais Camolesi Guimarães, Senior ESG Specialist at ILIM.
As part of the engagement with Mincon in 2023, ILIM conducted one virtual meeting with the company’s Chief Executive Officer (CEO) and the Chief Financial Officer (CFO), attended the company’s AGM, and participated in a site visit in the company’s factory in Shannon, Ireland. Later in the year, ILIM led a collaborative engagement with Mincon as part of the 2023 cycle of the CDP Non-Disclosure campaign, representing the investor group.
As a result of the engagement, in 2023, Mincon disclosed to the CDP Climate Change Questionnaire for the first time. Guimarães adds, “This is the first time that Mincon has disclosed to any of the CDP questionnaires or considered the global disclosure system for both investors and companies to manage their environmental impacts. As a first-year submission, the company has disclosed to the non-scored version of the CDP questionnaire.”
In this instance, ILIM intends to continue engaging with the company and encourage it to fully meet the engagement objective by seeking further progress on this topic and by disclosing to the scored version of the questionnaire in the next reporting cycle.
Evolving regulatory landscape
Some of the challenges ILIM noticed that companies have encountered include navigating the variety of reporting frameworks and requirements, resourcing allocation, perceived materiality of the environmental themes, and maturity of the sustainability journey of a company.
The proliferation of reporting requirements and frameworks globally is a particular challenge. “With the evolving regulatory and reporting landscape, some of the companies ILIM has engaged with are choosing to focus on the mandatory disclosures applicable to the regions where they have operations. Even though there is an alignment between data requested in the CDP modules, and the current and upcoming global reporting standards, there is still the challenge of prioritization and allocation of resources to the CDP disclosure request,” Guimarães explains. To tackle this, CDP has further aligned its corporate questionnaire with key global frameworks and standards, ensuring that it serves as a one-stop shop for companies seeking to disclose against the relevant market and regulatory demands.
For companies that are in the early stages of their sustainability journey, ILIM has found that: “It can still take some time for them to be ready to disclose to the CDP modules. This is typically because they will have to work on implementing the necessary measures, such as accounting for GHG emissions and setting reduction targets.” These insights can form a strong foundation for future engagement and dialogue with investee companies.
Learn more about CDP's Non-Disclosure Campaign including further case studies and financial institutions involved in the campaign.