What has prompted the user to acquire and employ the data for a specific use?
HESTA is focused on using our expertise and influence to deliver investment excellence with impact. We endorse the ambitions of the Sustainable Development Goals (SDGs) as an ambitious framework to address systemic risk and aspire to contribute to outcomes aligned with the aims of the SDGs through our capital allocation, active ownership and advocacy.

We therefore recognise the need to measure and manage our contribution to the SDGs and understand how our investments are contributing to real world outcomes. The SDI AOP provides a robust and consistent framework that allows us to identify investment opportunities that are aligned with relevant priority SDGs we believe we can contribute to.

How does the SDI AOP data differ from other sources out there?
One of the main reasons we purchased the SDI AOP data, and one of the main factors that we have found sets it apart from other data sources, is its revenue alignment approach that is consistent with our aim to move closer toward outcome (as opposed to process) based measurements. We also found that the data sets were based on a rigorous approach that had been developed for asset owners by asset owners.

The data we source from the SDI AOP also offers advantages such as ease of use, its position as a globally recognised platform adopted by many of our peers, and an expanding universe of tested companies, the largest across any application in the market. We also like that the product is being enhanced over time such as through the introduction of negative contributions as well as positive contributions and patent data.

Which teams in the organization use the data. Is it primarily RI, Portfolio Managers or Strategists using the data?  Is the data integrated in your systems? Which specific systems come to mind? How is the data being used and what are the results
The data sourced from SDI AOP is used primarily by the Responsible Investment (RI) team to identify investment opportunities and track our progress in terms of contribution through capital allocation to the SDGs. It is also leveraged by the equities team as a different lens for comparison of, and engagement with, prospective investment managers and for reporting and communications.

While the data is already pulled into HESTA’s data warehouse, we are currently building a range of user-friendly dashboards, created with applications such as Power Bi, to enable the whole of the investments team to access and analyse the data.

To whom do you report about the SDIs and how?
Our exposure to SDI’s is reported to a wide range of stakeholders through HESTA’s Annual Report and website, as well as in our RI communications such as our annual Climate Change Report. We also use the data to provide updates to the Investment Committee on the contribution to SDGs and new investment opportunities.

What are your objectives with SDI (e.g. applications to measure certain contributions, setting targets around SDI volumes or structure portfolios).
The SDI data allows us to measure our progress against specific portfolio targets. For example, in 2022 we announced our ambition to have 10% of the portfolio invested in climate solutions by 2030. We measure progress toward our 2030 climate solution target through annual measurement of investments aligned to SDG 7, 11.1 and 13, such as renewable energy and sustainable property.

The data has also been helpful in establishing a baseline for our level of thematic investments aligned to each of HESTA’s priority SDGs as well as the total overall level of Sustainable Development Investments in HESTA’s portfolio.

How important is the comparability of data in reporting?
We place importance on using data that enables us to accurately measure how our investments are contributing to and driving sustainable outcomes while delivering on our purpose to members.

The SDI AOP methodology is robust, the results are comparable between funds and the information is helpful for communications to member audiences. 

Interested in more SDI AOP use cases? Click here.