Alternative Asset Management & Sustainability Insights

Issue 36

A regular audio briefing for the alternative asset management industry.  Just about everyone agrees that a single set of internationally accepted sustainability disclosure standards would benefit all stakeholders. But global convergence creates significant challenges. For example, policymakers who are keen to set very high standards – the EU, for example – will be tempted to goldpla...

A regular briefing for the alternative asset management industry - Issue 34 Towards the end of last year, many private fund managers began reviewing their approach to interest rate risks. Although private funds are often heavily exposed to movements in interest rates – most obviously in relation to leveraged portfolio investments, but also for fund-level facilities and manager-level liquidity – lo...

The European Commission's renewed  Sustainable Finance Strategy , adopted in July 2021 and building on a  2018 Action Plan , was certainly ambitious. Indeed, the Commission has rightly credited the EU with "global leadership in setting international standards". But blazing a trail in a complex and novel regulatory field is a double-edged sword: there are bound to be missteps and – as ass...

A regular briefing for the alternative asset management industry - Issue 32 Last month, the UK government made some  important announcements  about its post-Brexit plans to re-vamp the funds regime.  Many alternative asset managers will be disappointed that a number of industry suggestions have not (yet) been taken up. For the last two years, the Treasury has been reviewing the...

A regular briefing for the alternative asset management industry - Issue 31 At the end of last month, the European Commission unveiled its  much-delayed plan  to require companies doing business in the European Union to undertake far-reaching sustainability due diligence throughout their supply chain.  Heralded by the Commission  as "a game-changer" which will "project European...

It is no surprise that the US Securities and Exchange Commission – now led by Gary Gensler, the Chair appointed last year by the Biden administration – has made proposals to increase the regulation of private fund managers (or "investment advisers"). But perhaps it is surprising that that the  rules proposed earlier this month  could have an important impact on many European firms, as we...

Last week, Carlyle pledged net zero greenhouse gas (GHG) emissions across its investment portfolio by 2050, and committed to significant progress by 2025. The goal itself is important, of course, but the way it will be achieved is perhaps even more newsworthy. As for other private equity firms who have set GHG reduction targets, the commitment is not founded on asset allocation or divestment – an...

Private equity had a bumper year last year. Although official data will not be available for a few months, there are already reports that 2021 was a record year for fundraising, investments and exits. That – together with data (and anecdotes) that continue to suggest that private markets are generating outsized returns – means that there are both more opportunities for asset allocators to access t...

Last year, many alternative asset managers worked harder than ever to ensure that their investment approach was equipped to meet one of the defining challenges of our time.  Sustainability – although not a new theme for most firms – was close to the top of the agenda.  While legal and compliance teams struggled to keep up with new and emerging sustainability regulation, senior-decision m...

For many private fund managers – especially a new firm, a spin out from a larger business, or a firm that manages a relatively small pool of capital – the UK regulatory requirements can be daunting.  Getting the necessary regulatory permissions is an expensive and time-consuming business, especially if there is no certainty that the fundraise will be successful, or if the fee structure leaves...

A regular audio briefing for the alternative asset management industry.  In the event, of course, the third country passport wasn't activated in 2015, and still hasn't been – perhaps in part because the UK voted to leave the EU in 2016, and UK-regulated firms could have used the passport to gain access to the single market. Meanwhile, the AIFMD review was duly launched in 2017, when KPMG was...

Glasgow's climate summit was both an important step forward and a missed opportunity to go further.  One important step forward was undoubtedly COP 26's unprecedented focus on the role of finance in tackling the climate emergency, which catalysed huge commitments from the private sector.  The Glasgow Financial Alliance for Net Zero ( GFANZ ) now speaks for over USD130 trillion of capital...

Last week's Autumn Budget confirmed the UK government's determination to use regulatory change as a key driver of economic growth and recovery. This ambition – which includes important changes to existing rules, as well as entirely new ones – has been evident for some time now. In part linked to Brexit, the government believes there is an opportunity for tax and legal rule-changes to help deliver...