From ai5000 Magazine: A Profile of No One

Europeans (effete liberals!) love it. Public pensions and foundations (goody-two-shoes!) like it. Yet, to American corporate defined benefit plans, socially responsible investing—bearded hippies!—has been anathema to their very existence. Will this ever change?

Corporate Pension Fund X, Anywhere, USA, 2010…

The first order of business is to convince him you’re not a Marxist hippie. This is not easy. When he takes a gander at this schedule for the morning and sees you on it, you and your commie-sounding imprimatur (some label like “Blue Heron Capital” or the “Forum for a Sustainable Future”), he automatically assumes you’re pitching an alpha-crushing dream of green pastures and butterflies. Then—you actually step into his office. If you have any sense about you, you’re sporting a somber time and a close-cropped hairstyle, blending in as best you can with this foreign world. Helloooo?, he says, elongating the vowel to signal a hint of suspicion. What can I help you with today?

It’s best not to mention certain words. “Green” is one of them. “Social” and “responsible” are both borderline. Banish the word “environment” from your lexicon. But you have to start somewhere. Let’s look at the great macro trends of the 21st century, you say. Urbanization. Resource scarcity. Population growth. How are you integrating this with your investment analysis?

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Commodity Rebound May Lead to Record Year for China's SWF

After a 2.1% loss on its global assets in 2008, the China investment Corp. will likely post its best yearly gain in 2009, boosted by rebounding markets and investment in commodity-related companies.

(July 23, 2010) — China’s $300 billion sovereign wealth fund may post a record year for 2009 as markets and commodities rebound.

The China Investment Corp. (CIC) will likely report a return on its global portfolio of more than 10% in its upcoming annual statement, Rachel Ziemba, London-based senior analyst at Roubini Global Economics told Bloomberg. The record year was spurred by Chairman Lou Jiwei’s investment of nearly $10 billion into commodity-related companies, such as Canada’s Teck Resources Ltd. in the second half.

In recent news, China’s SWF reported upping its emphasis on short-term performance this year, reflecting a growing attraction to more liquid investments. The CIC, which was set up in September 2007, gained 11% last year, but the fund has said it sees a challenging year ahead given the volatility in global markets. In May and June, the fund faced losses of about 10% as a result of growing equity market volatility from the European sovereign debt crisis.

Meanwhile, Temasek Holdings, Singapore’s state investment firm, reported that assets jumped 43% to $135 billion in the year to March 31. The rebound of the fund reflects the success of the globe’s sovereign wealth fund assets, which climbed 9% in 2009 from a year earlier to $3.5 trillion. The new peak also shows a trend of SWFs boosting investments in Asia to take advantage of the region’s strong economic growth. Other SWFs that have heightened investment in the region include the Qatar Investment Authority and Norway’s Government Pension Fund, the world’s second largest.

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To contact the <em>aiCIO</em> editor of this story: Paula Vasan at <a href='mailto:pvasan@assetinternational.com'>pvasan@assetinternational.com</a>; 646-308-2742

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