Hermes, the in-house fund manager of the BT pension scheme, has appointed Innovest Strategic Value Advisors, the socially responsible research and rating firm, to carry out sustainability research.

Hermes, which has pioneered a focus on corporate governance as an investment value driver, was one of the first to launch shareholder engagement funds. It will use the Innovest research to focus on companies' risk, performance and strategic positioning with regard to environmental, social and strategic governance issues. Innovest's ratings and research will be used as an overlay to Hermes' existing process and provide a tool in widening the scope of its engagement programmes.