Hope you are doing well and staying safe. Welcome back to our brief thoughts on ESG. This week, I want to share a couple of interesting things that popped up in the ESG world this week.
In this report, Blackrock joins ranks with other investors who have been very vocal about how ESG factors have helped outperform the market in recent months. Some interesting quotes that are likely to make you want to read the full thing:
“…we have observed better risk-adjusted performance across sustainable products globally, with 94% of a globally-representative selection of widely-analyzed sustainable indices outperforming their parent benchmarks.”
“…companies with a record of good customer relations or robust corporate culture are demonstrating resilient financial performance.”
“…the underperformance of traditional energy explains only a fraction of the outperformance seen in many sustainable funds.”
“As investors have sought to rebalance their portfolios during market turmoil, they are increasingly preferring sustainable funds over more traditional ones. In the first quarter of 2020, global sustainable open-ended funds mutual funds and ETFs) brought in USD40.5bn in new assets, a 41% increase year-over-year. U.S. sustainable funds attracted a record USD7.3 billion for the quarter.”
“We believe that we are still in the early stages of a persistent and long-lasting shift toward sustainability – the full effects of which are not yet included in market prices, given the long transition.”
This survey provides a good insight into what investors are thinking regarding ESG integration.
“Almost all respondents to our survey – fully 96% – said they believe institutions have a role in addressing the world’s most pressing challenges.”
“…a large majority (70%) say ESG will become a standard practice across the industry within the next five years.”
“They want to integrate ESG – and they want the tools and insights to do it in ways that maximize the societal and financial impact.”
“Six in 10 (60%) say they would be more willing to invest in projects that help provide solutions to societal challenges if those projects presented a risk/return profile in line with their portfolios’ long-term goals.”
Hope this was of use. As usual, if there is anything we can help you with, please reach out. Also, don’t forget to recommend any ESG subject matter that you would like us to research and put in a forthcoming weekly
Partner, Miranda ESG
This week’s recommended reading
- Sustainable Finance and ESG: The 2020 playbook
- Social factors gain stature in ESG analysis
- Covid-19 Is Accelerating ESG Investing And Corporate Sustainability Practices
- Citigroup Launches New ESG Investment Banking Group
- How Is ESG Performing In The Covid-19 Crisis?
- ESG fund flows increase 37-fold in three years: research
Contacts in Miranda Partners