ESG at All-time-high

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This week, Danish insurance and pension company Topdanmark announced the hiring of Andreas Stang as ESG investment manager. Stang leaves PFA Asset Management, where he was a Senior Portfolio Manager and the Head of ESG.

Also in Denmark, NordSIP caught up with Pelle Pedersen, Chief Impact & Growth Officer at DoLand, to hear more about the company, ahead of the expected October launch of a digital investment solution that builds tailor-made sustainable investment portfolios for Danish retail investors.

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While anecdotal evidence emerged suggesting that something good might actually result from the pandemic, Schroders published its latest Climate Progress Dashboard update which shows that the short-term adjustments stemming from the COVID-19 economic activity reduction do not appear to be improving the planet’s long-term changes.

Meanwhile, the crisis appears to have had an enduring effect on ESG investments by raising awareness about the benefits of this investment style. Data from inflows to global funds suggests that demand for exposure to ESG is at an all-time high. In fact, according to a new report by Invesco, institutional investors appear to be settling for ETFs as their preferred channel of ESG investing. This increase in demand may not be so surprising given that the majority of ESG index portfolios delivered better relative returns compared to broad markets during the Coronavirus period, suggests a recent white paper by UBS.

Surfing the wave for strong demand for sustainable investment products, new players continue to enter the market. This week, Evli was the latest manager to join this rush, launching a new investment fund focusing on green corporate bonds. Meanwhile, following the launch of the first green equity three months ago, Swedish real estate company Knaust & Andersson Fastigheter AB (K2A) announced the future launch of a senior unsecured green bond loan.

 

Image by Free-Photos from Pixabay

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The coronavirus epidemic has further accelerated the rise of ESG into the investment mainstream. As deficits skyrocket, bond investors have an opportunity to engage with governments on climate change, argues Thomas Dillon, Senior Macro ESG Analyst at Aviva Investors.

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