A growing number of institutional investors in Europe are embedding ESG analysis in their investment processes in response to regulatory pressure, consumer demand and a rising appetite for new sources of investment signals.
Investors can now measure the climate impact of the funds they invest in, using “the world’s first climate impact rating for funds”.
Investors can now measure the climate impact of the funds they invest in, using “the world’s first climate impact rating for funds”.
With melting ice caps and dwindling fossil fuel reserves, it’s easy to see why some £87bn (€99bn, $112bn) of assets have been funnelled into ethical and sustainable funds – but how wary should investors be when opting to put money into these strategies?
Sedco Capital, one of the largest asset managers in Saudi Arabia, has launched an investment strategy that integrates the firm’s Shariah-compliant investment approach with ethical investing.
US president Donald Trump’s decision to withdraw from the Paris Climate Agreement may result in securities issued by the US government becoming ineligible for ESG investors, experts say. But ESG fund managers are reluctant to disengage.
Investment managers have played down Donald Trump’s decision to pull the US out of the Paris climate agreement, saying the effect on companies will be minimal.
A hybrid approach that blends short-term and long-term views is needed when measuring the impact of ESG practices on fund performance, says Madhu Gayer, head of investment analytics for Asia at BNP Paribas Securities Services.
Chinese companies account for a tiny percentage of ESG-filtered emerging market ETFs, even though China is 26.5% of the MSCI EM Index.
ESG investing moved on from simple exclusion screening long ago, said Karine Hirn, partner at East Capital.
Instead of focusing on growth, the commodity and resources sector now stresses profitability, said Investec’s Tom Nelson.
ESG is making waves among socially responsible investors but, with some confusion as to the exact definition, Bruce Jenkyn-Jones of Impax says it is about giving a helping hand to companies making a positive change for good
