Digital library on sustainable finance
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The EU Technical Expert Group on Sustainable Finance released a report on climate-related disclosures as an input into the revision of the guidance framing non-financial corporate disclosure in the EU.
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According to the 14th edition of World Economic Forum’s global risks report, environmental risks dominate the global risks landscape in terms of impact and likelihood for the third year in a row.
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The International Organization of Securities Commissions (IOSCO) published its first official statement setting out the importance of including ESG matters when disclosing information material to investors’ decisions.
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In the present study, De Nederlandsche Bank (DNB) looks into environmental and social risks to which financial institutions might be exposed, focusing on 25 large and medium-sized Dutch financial institutions.
The report explores the extent to which selected environmental and social challenges, not just related to climate change, pose risks to financial institutions. It also takes stock of the processes that financial institutions have set up to lend direction to their sustainability policies.
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Values at Risk? Sustainability risks and goals in the Dutch financial sector - EN
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The 8th edition of the Eurosif SRI study gives a detailed picture of the European SRI industry, covering institutional and retail investor from 12 European markets.
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The paper reviews the scope and nature of the financing gap for sustainable development and the Sustainable Development Goals (SDGs) in order to propose new solutions for finance, business and a broader set of stakeholders. It builds on the Positive Impact Initiative’s earlier Manifesto (2015) and Principles for Positive Impact Finance (2017), clarifying the concepts of impact-based business models, impact-based economy and holistic impact analysis
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Do people put their pension savings on the table to promote sustainability? This paper answers the question in a large-scale field experiment (n = 3,256). The pension fund in the study gave its members a real vote for more or less sustainable investments. A comparison group made the same decision, but hypothetically. The paper finds that 66.7% of the participants favor to invest their pension savings in a sustainable manner.
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Get Real! Individuals Prefer More Sustainable Investments - EN
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Sustainable investment is gaining momentum in Europe, but its current proposed taxonomy might hinder innovation in the field. In this policy paper, Dirk Schoenmaker advocates for an active investment approach with concentrated portfolios, and sets out a six-point plan for sustainable investing.
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The 6th SWIRPA Corporate Governance Survey, conducted in cooperation with researchers at the DBF (UZH), covers developments in governance in the Swiss market. A total of 154 participants filled out the survey, representing more than 77% of the SPI market cap and 26% of global equity AuM.
A presentation of the finding is available for download.
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In order to help property investors develop and implement an impact-based approach in their investments, an action-oriented investor framework has been developed to help guide decisions at any stage of the property investment cycle.
This report focuses on four Investment Objectives which offer a way for institutions to frame decision-making for more immediate-term investment activities and longer-term aspirations that derive from Positive Impact’s holistic and impactbased approach.
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Combining corporate sustainability performance scores based on environmental, social and governance (ESG) data with big data measuring public sentiment about a company’s sustainability performance, this paper finds that the valuation premium paid for companies with strong sustainability performance has increased over time and that the premium is increasing as a function of positive public sentiment momentum. The evidence suggests that public sentiment influences investor views about the value of corporate sustainability activities
and thereby both the price paid for corporate sustainability and the investment returns of portfolios that consider ESG data.
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SSRN-id3265502 (pdf 572.0 kB)Summary
As a global financial centre with a growing strategic interest in sustainable finance, and a country recognized as a leader in digital technologies and innovation, Switzerland is seeking an improved understanding of how digital finance can accelerate the greening of financial flows. UN Environment, with support from the Swiss Federal Office for the Environment (FOEN), undertook a stocktaking to map emerging green digital finance practices in Switzerland and globally in 2018. The paper provides options for a number of national and international actions that could be taken forward by different stakeholder groups.
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Green Digital Finance. Mapping Current Practice and Potential in Switzerland and Beyond - EN
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Much research has been done on the relationship between environmental, social and corporate governance (ESG) investing and performance in equity markets, but far less on its effect on the credit markets. This study into the behaviour of corporate bond portfolios showed that applying ESG factors resulted in a small but steady performance benefit and no evidence of a negative effect.
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This document contains answers to frequently asked questions regarding the work of the Technical Expert Group on Sustainable Finance (TEG) set up by the EU Commission, and the legislative proposals that frame its work.
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Technical Expert Group on Sustainable Finance – Frequently Asked Questions - EN
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This study explores the relationship between ESG and credit portfolio performance in the US dollar and euro investment grade credit markets, as well as the USD high yield credit market. The study found that favouring bond issuers with high ESG ratings can generate positive returns across markets, geographies and sectors.
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Institutional investors are increasingly realising that income inequality—the gap in income and wealth between the very affluent and the rest of society—has become one of the most noteworthy socioeconomic issues of our time. The report identifies three themes material to long-term investors and also suggests paths that investors might take to adopt a more balanced view of how to create value, manage system-level risks and maximize rewards while still operating profitably and enjoying competitive returns.
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Like all investors, sustainable investors juggle various motivations: improving investment performance, achieving an economic or a societal outcome, and investing in ways consistent with their values/beliefs. The challenge for sustainable investment professionals is to understand their clients’ motivations and then shape their expectations and investment strategy accordingly. Given this range of motivations and the diversity of environmental, social, and governance systems, it should not be surprising that there are many ways to approach investing sustainably.
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This book examines the impact of multinational enterprises (MNEs) on local economies, and presents selected case studies of MNEs operating in low income countries. By balancing external social and environmental costs against its corresponding benefits, the book demonstrates that MNEs can have a positive net-impact on local development if they build up social capital by embedding themselves in local economies and engaging responsibly with local stakeholders. By doing so MNEs contribute to inclusive growth, a central pillar of the UN Sustainable Development Goals.
In this context, the book challenges popular narratives in civil society and academia that frame foreign direct investment (FDI) merely as a threat to human rights and sustainable development. Moreover, it offers practical guidance for globally operating businesses seeking to establish progressive Corporate Social Responsibility (CSR) strategies of their own.
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Global Business in Local Culture. The Impact of Embedded Multinational Enterprises - EN
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Es gehört zu der treuhänderische Sorgfaltspflicht der mit der Verwaltung und Vermögensverwaltung einer Vorsorgeeinrichtung betrauten Person das beachten von relevanten Anlagechancen und -riskien zu identifizieren, bewerten und entsprechend zu berücksichtigen und diversifizieren. Hierzu gehören Klimarisiken und -chancen.
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Rechtsgutachten Klimarisiken in der Vermögensverwaltung bei Pensionskassen - DE
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This global study was commissioned for a second year by Schroders to analyse institutional investors and their attitudes towards sustainable investments, investment objectives and risk. Respondents represent a variety of institutions, including pension funds, foundations, endowments and sovereign wealth funds and manage approximately $24 trillion in assets. The 650 institutional respondents were sourced from 15 different countries.
The study found that while the outlook for incorporating sustainability in institutional portfolios is strong, sustainability currently plays a muted role in investment decision-making.
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This overview paper is the first in a body of work on an inevitable, rapid and forceful climate policy response, developed by the PRI in order to help institutional investors take action and implement processes to build resilience across investment portfolios.
The report series assesses the investment implications of a rapid and forceful policy response to close the gap to the Paris Agreement – what is referred to as an Inevitable Policy Response (IPR) – having recognized that the full impact of a delayed, but forceful policy response has not been widely debated or understood by many in the institutional investment community.
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This technical paper is part of a body of work on an inevitable, rapid and forceful climate policy response. It was developed by the PRI in order to help institutional investors take action and implement processes to build resilience across investment portfolios, in face of what is referred to as the Inevitable Policy Response (IPR).
This paper explains why a forceful climate policy response is inevitable and sets out the multiple forces building in the system that could come forward and trigger a rapid (but also late and costlier) policy suite by governments.
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This technical paper is part of a body of work on an inevitable, rapid and forceful climate policy response. It was developed by the PRI in order to help institutional investors take action and implement processes to build resilience across investment portfolios, in face of what is referred to as the Inevitable Policy Response (IPR).
Having considered the various potential drivers of an IPR, the paper further considers when the IPR could occur, what policy and technology pathways it might take, and how these pathways would affect the macroeconomy and risk-returns of financial assets.
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This technical paper is part of a body of work on an inevitable, rapid and forceful climate policy response. It was developed by the PRI in order to help institutional investors take action and implement processes to build resilience across investment portfolios, in face of what is referred to as the Inevitable Policy Response (IPR).
The paper presents a framework that institutional investors can utilise as part of their response to an IPR outcome. It will help prepare investors for an IPR and the implications it will have for further adapting and shifting SAA processes and portfolio construction techniques.
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The Inevitable Policy Response: Strategic Asset Allocation and Portfolio Construction - EN
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This technical paper is part of a body of work on an inevitable, rapid and forceful climate policy response. It was developed by the PRI in order to help institutional investors take action and implement processes to build resilience across investment portfolios, in face of what is referred to as the Inevitable Policy Response (IPR).
This paper pulls together the strands of the IPR, and sets out the issues to support a robust investor response ross the broader areas of portfolio management processes, including taking preparatory action to review governance arrangements, risk management processes, engagement with policy-makers, companies and service providers.
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