ESG and Sustainability

The rise of ESG factors in investment decision making will have a dramatic impact on returns and opportunities in the 21st century. A recent survey by LGT Capital Partners and Mercer showed that 57% of respondents believe that incorporating ESG standards into investment decisions will raise returns. Just 9% argued they reduce returns on investment.



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French Pension Fund Dodges U.S. Treasury Market

ESG Concerns Shun the World’s Most Liquid Market A French pension fund and several other ESG funds are shunning the U.S. Treasury market. The funds found fault this week with the United States government and listed reasons for divestment. According to Bloomberg, ESG funds at Erste Asset Management, Joh. Berenberg Gossler, and Union Investment are leading the trend.  French pension fund lists reasons for Uncle Sam divesting These groups listed concerns about U.S. policy on nuclear weapons, climate change, capital punishment, and more. These factors have fueled an exodus from the most liquid market on the planet. “ESG-dedicated investors would usually avoid or question investments in U.S. Treasuries,” said Rupini Deepa Rajagopalan at Berenberg. That fund oversees 36.7 billion euros. This asset manager cited U.S. stances on nuclear weapons and climate change as reasons to avoid the U.S. bond markets.  The report also listed the $36 billion French Public Service Additional Pension Scheme as another firm bailing on the U.S. A spokesperson listed capital punishment as a reason for the divestment. Will ESG funds struggle?  As we noted Tuesday morning, the sudden rush of ESG standards and funds feels familiar and concerning. Recently, British analyst Daniel Litvin expressed our concerns perfectly. As…

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French Pension Fund Dodges U.S. Treasury Market
October 15, 2019

ESG Concerns Shun the World’s Most Liquid Market A French pension fund and several other ESG funds are shunning the U.S. Treasury market. The funds found fault this week with…

Climate Change Protests in London: Activists Glue Themselves to BlackRock’s Doors
October 14, 2019

Climate change activists took on the world’s biggest financial institutions today, specifically BlackRock and the Bank of England, in London. They demanded the cessation of funding of a looming environmental…

Temasek Will Sit Out the Saudi Aramco IPO on Environmental Concerns
October 12, 2019

Singapore’s Temasek Holdings will not invest in Saudi Aramco’s mega-IPO, sources said, according to Bloomberg. Temasek, which focuses on sustainability and environmental, social and governance principles, will, therefore, be unable…

LGPS Launches Climate Change Strategy
October 10, 2019

LGPS Central has announced the launch of a multi-factor equity fund. The manager of pooled assets from nine British public sector pension funds say that climate change sits at the…

Pepsi Issues Its First ‘Green Bonds;’ These Align With UN Sustainable Development Goals
October 10, 2019

Pepsi issued $1 billion in senior notes due 2049, at a coupon of 2.875%, payable semiannually. This new debt offering is the first of Pepsi’s green bonds. Pepsi will use…

MUFG First in Japan to Issue Aussie Dollar-Denominated Green Bonds
October 9, 2019

MUFG’s green bonds amounting AU$500 million (US$337 million) were oversubscribed twice over. Australian institutional investors purchased most of the flotation. MUFG issued this latest tranche of its green bonds in…

An ETF To Take Advantage Of “One Of The Largest Infrastructure Build-Outs In History”
October 8, 2019

According to Goldman Sachs, cities will be on the frontlines of climate adaptation. Urban adaptation will have to follow. The FlexShares STOXX Global Broad Infrastructure Index Fund (NYSEArca: NFRA) is…

Park Square Capital: Private Credit Investors in Favor of ESG-positive Deals
October 8, 2019

Park Square Capital, a US$10 billion investor in private credit, is a signatory to the UNPRI. ESG in private credit deals is making steady progress as investors wise up to…

Oil Rich Norway’s Government Pension Fund Slashes Exposure to… Oil Production
October 4, 2019

Norway’s Government Pension Fund Global, Oslo, will cut its exposure to upstream energy production. The pension fund will cut 50 billion Norwegian kroner ($5.5 billion) in equity allocation from its…

Purpose Investments Goes All In on ESG Principles
October 3, 2019

Purpose Investments is the latest asset manager to integrate environmental, social and governance – ESG principles – into its strategies. The catch – they will adopt ESG into every single…