TradePost USA Advisor Daniel Abbasi, a low-carbon private equity investor, non-profit leader and TV producer on climate change, attended the 7th Annual CSR Investing Summit, organized by S-Network Global Indexes, Inc. on July 17, 2019.
The event covered the rapid growth and professionalization of ESG investing, both its integration as an increasingly salient fundamental risk and opportunity factor incorporated by mainstream asset managers, including in their passive/index products, as well as a thematic driver for dedicated products marketed to values-driven (often millennial) investors seeking “impact” outcomes.
Academic meta-research was cited showing that over 90% of studies found positive or neutral correlation between ESG factors and market performance, indicating that the longtime bias that ESG impairs returns is likely outdated.
Climate change was highlighted as a dominant ESG factor and “systemic risk” for equities (less so for bonds, esp. short bonds), and described as giving more performance bang for the buck in active equity strategies and in illiquid asset classes such as private equity and real estate.
Shareholder engagement on climate change was also explored at length, with panelists recognizing that divestment and engagement are complementary and often reinforcing rather than alternatives
Are you enjoying the article? Join our community for even more!