Sustainability an essential focus for long-term investors
At GIC, Singapore's sovereign wealth fund, it is what underpins its investment and corporate processes.
Add BT as a preferred sourceAMID the turmoil created by the Covid-19 crisis, what stood out was the continued shift towards sustainable or ESG (Environmental, Social and Governance) investing.
Global sustainable funds saw strong capital inflows of around US$117 billion, versus a net outflow of US$30 billion for the broader fund universe over H1 2020. Sustainable funds and indices also outperformed their counterparts in H1 2020. For example, returns on the MSCI World Socially Responsible Investment (SRI) index outperformed the MSCI World index by 411 bps over the same period, even controlling for sector tilts (such as underweight energy, overweight technology).
The pandemic has also highlighted some key ESG-oriented structural shifts. First, it has magnified the vulnerabilities and awareness of rising social inequality, specifically in the areas of access to technology, healthcare, jobs and social safety nets.
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