Written answers

Wednesday, 16 November 2016

Department of Finance

Ireland Strategic Investment Fund Investments

Photo of Margaret Murphy O'MahonyMargaret Murphy O'Mahony (Cork South West, Fianna Fail)
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95. To ask the Minister for Finance if he has considered the introduction of a formal ethical investment policy for the taxpayer funds that are currently invested as part of the Ireland Strategic Investment Fund, managed through the National Treasury Management Agency; his views on the appropriateness of holding investment in tobacco companies as part of this fund (details supplied); and if he will make a statement on the matter. [35275/16]

Photo of Michael NoonanMichael Noonan (Limerick City, Fine Gael)
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The Ireland Strategic Investment Fund (ISIF) currently operates a Sustainability and Responsible Investment Policy, which is published on ISIF's website. In addition, the Fund operates to high international standards and invests in line with both the UN-sponsored Principles for Responsible Investment (PRI) and the Santiago Principles, which are the globally accepted best practice principles for sovereign investment funds such as ISIF.

ISIF commits to reviewing all of its investments for exposures to sectors and/or companies with potentially controversial business exposures and associated reputational risks. Historically, exclusion has not been part of ISIF's Responsible Investment strategy with the only exclusions from the Fund being mandated by legislation.  To date, the Cluster Munitions and Anti-Personnel Mines Act (2008) is the only relevant legislation and the ISIF operates a prohibited securities list of 19 companies on this basis. 

I am informed by ISIF that its senior management and the NTMA Board's Investment Committee agreed to review the current Sustainability and Responsible Investment Policy to examine the potential of adding to the list of excluded investment categories. This process is currently underway and is expected to be completed by the end of the first quarter of 2017.

In relation to investment in tobacco companies, I am informed by the ISIF that on the basis of preliminary and unaudited figures for end Quarter 3 2016 i.e. as at 30th September 2016 ISIF had equity holdings in three tobacco companies with a value of €1.5m or 0.02 per cent of its total assets. Such investments should be considered in the context of ISIF's broader portfolio and the Fund's commitment to responsible investment.

The wider review of ISIF's investment strategy, due to take place 18 months after the establishment of the ISIF, will include an appraisal of the success of ISIF's mandate to date. Work on the review has commenced and is due to be completed by end-2016.

In light of all of the foregoing I am satisfied with the approach adopted by ISIF to date in implementing its agreed investment strategy while taking into account international best practice. Both the NTMA and Government are mindful of the fact that public attitudes and policy are not fixed and can evolve. The ongoing review of exclusions by the NTMA and the wider review of ISIF's investment strategy are opportunities to fine tune the approach in the light of relevant developments both nationally and internationally.

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