According to HSBC’s newly released ESG Sentiment Survey, the adoption of ESG continues to rise in response to regulatory pressure and investor demand.
Respondents from nearly 400 institutions representing over $11.5T in assets weighed in on the state of ESG:
“Regulations are becoming a bigger driver for investors and corporates to integrate ESG,” noted Wai-Shin Chan, Global Head of ESG research at HSBC. “Regs are moving from being a gentle nudge to a stronger push.”
What Does This Mean for Investors?
While statistics show that ESG is in high demand among US investors, there is clearly a wide range of understanding and integration when it comes to ESG and portfolio deployment. At a global level, the story is different: asset owners and managers are much more fluidly integrating ESG. Investors are increasingly able to access funds and fixed-income vehicles with ESG research baked in.
What Should Financial Advisors Do?
Discuss ESG vehicles with fund distributors and get a clear understanding of the type of product that’s available. If you construct portfolios in-house, be prepared to explain why – or why not – ESG is a part of your due diligence process.
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