At USS our duty is to protect and enhance the value of our investments over the long-term, with the ultimate aim of providing secure pensions for our members. This means we need to consider all long-term risks to the performance of our investments, including material environmental, ethical, social and corporate governance (ESG) factors where these have a financial bearing. Examples of ESG matters routinely considered by the fund are outlined under the RI Approach page on the fund's website - see https://www.uss.co.uk/how-uss-invests/responsible-investment/approach.
USS employs an experienced in-house RI team to help identify and review ESG risks and materiality on a deal by deal basis. The scheme commits resources to ensuring that the team has access to research and tools to implement RI, and is committed to continuous professional development through participation in industry initiatives and events and training. Through this process, ESG risks, their materiality and the mitigants in place to manage these risks are outlined ahead of each deal, and feed into the investment decisions taken by the Private Markets Investment Committee.
In addition, where external specialist environmental etc. consultants are used in the ESG due diligence process, we will usually request that they provide monetary values on issues they identify. This ensure that those which hit a certain materially threshold are included with other financially material issues in future management planning.