A TRUSTED ESG SUSTAINABLE IMPACT METRICS
We know that sustainability is a long-term force for change and a driver to integrate ESG across our investment solutions, actively engage with companies, and work on real impact.
By diving deeper to understand dynamics and impact, our comprehensive sustainable approach leads to better-informed investment decisions. Creating better returns – and looking after the world we live in.
The relevance of ESG Integration
ESG engagement and ESG voting gain traction
- All of the SI approaches grew in volume in 2019. ESG integration remains in the lead, followed by exclusions. The high growth rates illustrate the mainstreaming process in financial markets : sustainability is not a niche topic any more. ESG engagement now ranks third, indicating that active interaction with investee firms is gaining in importance. It is interesting to note that the growth rates of ESG engagement as well ESG voting are the strongest – after impact investments – showing a clear shift in focus to a more outcome-oriented SI mindset.
- The lack of conviction of client advisors is no longer the main barrier for asset managers, but rather a lack of standards. For asset owners, performance remains the major concern, closely interlinked with the notion of fiduciary duty
Main ESG Engagement Themes
- risk management and reporting related to climate change was a very important subject to engage with. This outcome may be ascribed to the circumstance that climate change related risks in financial markets have become more prominent in public debates, for example through initiatives such as the Task Force on Climate-related Financial Disclosures (TCFD).
THE ROLE OF THE SDGS FOR INVESTORS
- In order to determine an investment product’s specific contribution to the SDGs, several options were named. Only three respondents stated that they use IRIS metrics to determine the SDG contribution of their products. The answers suggest that most asset managers do not use a standardised evaluation scheme but an in-house solution to determine their products’ contribution to the SDGs. These individual qualitative and quantitative assessment frameworks make direct comparisons difficult between offered SDG-related products.
Measures to Address Climate Change Within Investments for Asset Managers
- Despite the importance and the rise in awareness of climate change and its impact on the economy, only 15 respondents said they publish information on their climate change strategy. Even though there is a steady increase in the number of respondents in this study who indicate that they do publish their climate change strategy, this outcome remains an area for improvement, since only through comprehensive reporting and disclosure practices will the knowledge and the quality of the strategies to tackle climate change improve