Apr 2018

Responsible Investing Roundtable

The Andaz Hotel, 40 Liverpool Street, London

Responsible Investing – The metric for success?

Responsible Investing is getting more focus than it ever has done before, with many stating that their strategies will not only give peace of mind, but will produce increased levels of return.  In some ways, therefore, responsible investing can be seen as a strategy to specifically generate return.

There are many different stages of responsible investing with one level taking into account firms that integrate Environmental, Social and Governance (ESG) factors as part of their overall process, secondly, firms that produce SRI specific funds which could look to exclude certain types of stocks and/or those strategies that track how they make a tangible impact to world.

In light of this increased interest, corporations in which funds invest are encouraged to incorporate ESG factors as part of their operating policy.  This can include factors such as environment stewardship, consumer protection, human rights and diversity.

Although many may view the SRI approach as subjective, there are ways to measure ESG factors, with MSCI producing their ESG index series with over $85 billion in institutional, retail and exchange traded funds being benchmarked to the MSCI ESG index series; and the FTSE4Good Index series designed to measure the performance of companies demonstrating strong ESG practices.

Going forwards, we can expect increased transparency and more concrete data being produced measuring how investments are making an impact.  Indeed, there is certainly room for more tangible analysis to be produced in the future to determine whether this type of investing is truly a ‘metric for success’.

In addition, why stop there?  We can also expect to see positive screening rather than negative screening, with funds looking for those firms that are actively make a difference, rather than excluding those that may cause an ethical conflict.

CAMRADATA’s Roundtable will look out how the approach to Responsible Investing is developing over time, the current issues that are being faced and innovative solutions we can expect see going forwards.

The Andaz Hotel, 40 Liverpool Street, London