Andrew Lockhart

Metrics Credit Partners (Metrics), a leading Australian non-bank corporate lender, has joined the Net Zero Asset Managers (NZAM) initiative, marking its commitment to supporting the goal of net zero greenhouse gas emissions across its portfolio of loans and its own operations by 2050, if not sooner.

Metrics is an investor signatory of the initiative, which guides 220 groups managing US$57.4 trillion of investor funds in their efforts to limit warming to less than 1.5 degrees Celsius and support investment aligned with net zero emissions by 2050. In joining the NZAM, it has also become part of the Glasgow Financial Alliance for Net Zero which brings together the financial sector to accelerate the transition to a net-zero economy and the UN “Race to Zero” which aims to build business and civil society momentum towards addressing climate change.

Participation in the Net Zero Asset Managers initiative coincides with Metrics joining the Investor Group on Climate Change (IGCC), a collaboration of Australian and New Zealand investors focusing on the impact that climate change has on the financial value of investments.

Metrics joined IGCC in September and committed to the NZAM initiative to provide a plan for the firm’s activities and a measure of accountability for its investors, customers and employees.

As part of its commitment, Metrics is required to submit a plan to achieve net zero emissions and provide annual reporting on its progress toward that goal. Metrics is developing science-based targets for Scope 1, 2 and 3 greenhouse gas reductions and, as part of this, has engaged consultants to review emissions across its portfolio and its own operations.

Metrics Managing Partner Andrew Lockhart said investors and asset managers have a vital role to play in helping address the environmental impacts of the businesses they support.

“Metrics is determined to play a leading role in promoting and assisting with the transition to a low carbon economy.

“This presents an enormous opportunity and Metrics is committed to ensuring that we both lead by example and ensure our stakeholders have the means to participate in achieving a just and timely transition. Metrics is proud to join IGCC and commit to the Net Zero Asset Managers initiative to further this goal.”

Metrics provides private credit funding to Australian and New Zealand business and is a significant lender to the commercial property sector through a suite of listed and unlisted funds. Since being founded in 2011 it has provided more than $15 billion to borrowers across multiple industries and sectors. As one of the largest non-bank providers of private credit in Australia, Metrics actively promotes the development of the local capital markets and long-term, sustainable business practices to address the challenges of climate change.

Metrics has already taken several steps to enhance its capabilities for sustainable investing and achieving ESG outcomes, including:

• the appointment of experienced executive Alison Chan as Investment Director – Sustainable Finance
• updating its ESG policy
• becoming a Founding Member of the Australian Sustainable Finance Institute which is an unprecedented collaboration formed to help shape an Australian economy that prioritises human well-being, social equity and environmental protection, while underpinning financial system resilience and stability
• becoming the first Australian non-bank asset manager to join the Climate Bonds Initiative which aims to help redirect capital towards investment that can help achieve net zero emissions.

By joining IGCC, Metrics becomes part of a global group of investors collaborating to pull together and elevate the best investor guidance on tackling the climate crisis and advocate collectively for public policy to accelerate the net-zero transition – called the Investor Agenda.

At the COP26 meeting in Glasgow this week the Investor Agenda presented a statement, signed by 733 investors with over US$52 trillion in assets under management – around 50 per cent of the global total, urging governments to raise their climate ambition to limit global warming to no more than 1.5 degrees, implement meaningful emissions reduction policies, mandate climate-related financial reporting in line with the recommendations of the Task Force on Climate-Related Financial Disclosures (TCFD), and deliver COVID-19 economic recovery plans that support a just transition to net-zero emissions by 2050 or sooner.

The 2021 Global Investor Statement reads: “…we believe that those who set ambitious targets in line with achieving net-zero emissions and implement consistent national climate policies in the short- to medium-term, will become increasingly attractive investment destinations.”

“Full implementation of the Paris Agreement will create significant investment opportunities in clean technologies, green infrastructure and other assets, products and services needed in this new economy.”

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Alison Chan

Metrics Credit Partners has announced new appointments within its Investments and Corporate teams, as the business continues to grow and intensify its focus on sustainability, further cementing its position as Australia’s leading non-bank corporate lender.

Alison Chan has been appointed as Investment Director – Sustainable Finance, based in Sydney, responsible for developing innovative sustainable finance strategies to support the global transition to a low carbon economy. Ms Chan joins from National Australia Bank where she was Director, Sustainable Finance. Prior to that she was a Senior Advisor to Climate Bonds Initiative, based in London.

In 2018 Ms Chan was named Governance Professional of the Year by ICSA: The Governance Institute, for her commitment to good governance and her innovative and effective approaches to lasting improvements to governance.

Metrics Managing Partner, Andrew Lockhart, said: “We are thrilled Alison has joined our team to help enhance and deliver our sustainability vision. Her experience working with infrastructure owners in Sydney and London with their transition to a low carbon economy will be key as we continue to evolve our approach to ESG integration.”

Lalit Barhate and Luke Adams have recently been appointed to the corporate office as Director, Internal Audit and Group Treasurer, Finance & Fund Accounting, respectively.

“All three bring extensive industry experience and position us well for continued growth,” Mr Lockhart said.

Metrics also announced seven additional appointments – four analysts and three associates to support its investment team across Australia and New Zealand, taking the total team to more than 90.

Heightened environmental, social and governance (ESG) focus

Mr Lockhart said Metrics’ approach to responsible investment and ESG issues is growing in importance as regulation, climate change and societal expectations evolve.

“Sustainability is at the heart of the Metrics business and has always been a core part of our investment philosophy. We have a responsibility to act in the best long-term interests of investors in our funds, and we believe ESG issues present both risk and opportunity – affecting the performance of our funds and the long-term, risk-adjusted returns we ultimately deliver to our investors.”

Mr Lockhart also recognised the potential for the funds management industry to have an impact on creating a better world: “As a fund manager, the main channel through which we can influence the real world is through the companies in which we invest. We have a responsibility as a fund manager to accelerate and mainstream sustainability across the real economy.”

Metrics recently detailed its approach to sustainability in a new ESG policy. Environmental policy aims integrated into Metrics’ investment decisions include support of the Paris Agreement goal of limiting global warming to below 2ºC, preferably to 1.5 ºC, and actively supporting the adoption of renewable or lower-carbon fuels and energy sources.

Metrics believes certain activities and industry sectors represent outsize risk to the firm and its investors and therefore has several negative investment screens including on the development of new oil and gas fields and entities that operate in the coal industry.

Further reinforcing its commitment, Metrics recently became a Partner to the Climate Bonds Initiative and a member of the APLMA Green & Sustainable Loan Committee. This adds to existing commitments as:

• signatory to the UN-supported Principles for Responsible Investment
• founding Member of the Australian Sustainable Finance Institute, which was established to drive and coordinate the delivery of the Australian Sustainable Finance Roadmap, and
• supporter of the Transition Pathways Initiative.

“While the focus of ESG started in listed equities, investors want to know that ESG factors are integrated into the broad range of asset classes including private debt and private equity,” Mr Lockhart concluded.

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