Pension Funds and Sustainable Investment

Brett Hammond is a research leader at the American Funds of the Capital Group; he is also Executive Vice President of the Q Group and member of the Pension Research Council's Advisory Board. Previously he directed research teams at MSCI, and he served as chief investment strategist at TIAA-CREF while working on the creation of target-date funds, inflation-linked bonds, and individual financial advice. He also served on the senior management team at The National Academies, responsible for behavioral and social sciences studies; he also taught at The Wharton School. His research focuses on investing, institutional and individual asset allocation, pensions, higher education, and public policy. He received his bachelor's degree in economics and political science from the University of California at Santa Cruz, and a Ph.D. from the Massachusetts Institute of Technology. He is currently editor-in-chief of the peer-reviewed Journal of Retirement.Raimond Maurer is Professor of Investment, Portfolio Management, and Pension Finance at the Finance Department of the Goethe University Frankfurt. His research focuses on asset management, lifetime portfolio choice, real estate, and pension finance. Previously he was in residence at the Wharton School as Visiting Professor, and he serves as Advisory Board member of the Pension Research Council. His other professional activities include serving on the Union Real Estate Investment group, the Society of Actuaries, and the Association of Certified International Investment Analysts. He recently completed a Deanship at the Faculty of Economics and Business of the Goethe University, where he currently serves on the Faculty Senate. His habilitation and dissertation were awarded by Mannheim University, and he also was awarded an honorary doctorate from the State University of Finance and Economics of St. Petersburg.Olivia S. Mitchell is the International Foundation of Employee Benefit Plans Professor, and Professor of Insurance/Risk Management and Business Economics/Policy; Executive Director of the Pension Research Council; and Director of the Boettner Center on Pensions and Retirement Research; all at The Wharton School of the University of Pennsylvania.Concurrently Dr. Mitchell serves as a Research Associate at the NBER; Independent Director on the Wells Fargo Fund Boards; Co-Investigator for the Health and Retirement Study at the University of Michigan; and Executive Board Member for the Michigan Retirement Research Center. She also serves on the Academic Advisory Council for the Consumer Finance Institute at the Philadelphia Federal Reserve; the Advisory Committee of the HEC Montreal Retirement and Savings Institute; and the UNSW Centre for Pensions and Superannuation. She earned her B.A. in Economics from Harvard University, and her M.S. and Ph.D. degrees in Economics from the University of Wisconsin.

The book offers research with case studies from different countries and a range of perspectives. I recommend the book because it adds to our understanding of crucial current topics affecting business, investments, personal planning, and many societal issues. Advisors in particular need to take interest in this topic because of their clients' interests and needs and because it affects retirement investing.

• 1: Brett Hammond, Raimond Maurer, and Olivia S. Mitchell: Sustainable Investment in Retirement Funds: IntroductionPart I. Defining and Measuring Sustainable Objectives and Outcomes2: Brett Hammond and Amy O'Brien: Pensions and ESG: An Institutional and Historical Perspective3: Stéphanie Lachance and Judith Stroehle: The Origins of ESG in Pensions: Strategies and Outcomes4: Linda-Eling Lee: What Does ESG Investing Really Mean? Implications for Investors of Separating Financial Materiality and Social ObjectivesPart II. The Evolution of Pension ESG Investing5: Christopher Geczy and John Guerard: ESG and Expected Returns on Equities: The Case of Environmental Ratings6: Zacharias Sautner and Laura Starks: ESG and Downside Risks: Implications for Pension Funds7: Luba Nikulina: Global Pensions and ESG: Is There a Better Way?Part III. Impacts of ESG on Pension Governance, Investments, Structures, and Reporting8: Rob Bauer and Paul M.A. Smeets: Eliciting Pension Beneficiaries' Sustainability Preferences: Why and How?9: Nathan Fabian, Mikael Homanen, Nikolaj Pedersen, and Morgan Slebos: Private Retirement Systems and Sustainability: Insights from Australia, the UK, and the US10: Anita Margrethe Halvorssen: How the Norwegian SWF Balances Ethics, ESG Risks, and Returns: Can this Approach Work for Other Institutional Investors?