ISS ESG 2023 Report Identifies Key 2023 Regional ESG Opportunities and Risks for Investors

Report highlights regional trends of investor focus likely to impact portfolio risk-return

NEW YORK (March 23, 2023) — ISS ESG, the sustainable investment arm of Institutional Shareholder Services Inc. (ISS), today released Actionable Insights: Top ESG Themes in 2023 – Regional Edition, an in-depth, regionally focused complement to its annual world outlook report, Actionable Insights: Top ESG Themes in 2023 – Global Edition. The new report draws on comprehensive ISS ESG data, with research and insights from ISS ESG’s financial research and sector leads, climate specialists, and regulatory experts to help investors identify key regional ESG risks and opportunities likely to impact their portfolios in 2023.

Key takeaways from ISS ESG’s 2023 regional trends report include:

• Climate change, accurate disclosure of ESG-related assets and activities, the consequences of Russia’s invasion of Ukraine, and protecting human rights are concerns that cut across regions.
  
• In the Americas, the United States is pursuing climate mitigation measures through the Inflation Reduction Act, while the Federal Reserve Board is encouraging major banks to apply climate scenario analyses to their portfolios. President Lula’s administration in Brazil is addressing environmental issues by trying to protect the Amazon from deforestation.
  
• In EMEA, the European Union is requiring banks to disclose the share of their assets that are environmentally sustainable, a measure known as the “Green Asset Ratio.” Investment funds with “ESG” in their names frequently attract investors but require careful consideration of how ESG-compatible they really are. Despite the Ukraine conflict’s disruption of food supply chains, food companies in Europe have so far largely avoided a significant diminution of their profits, but whether this situation will continue into 2023 remains to be seen.
  
• Increased natural gas prices, partly caused by Russia’s invasion of Ukraine, are spurring Japan, South Korea, and Singapore to diversify and prioritize their energy transition strategies towards alternative sources. In Japan, addressing risks related to modern slavery, including among migrant workers, is a pressing concern.    
  
• In Australia and New Zealand, the public and private sectors are responding in various ways to the challenge of providing adequate insurance in the face of growing climate change hazards. Measures to give First Nations Australians a voice in parliament could help these communities better protect their interests. At the industry-level, one of the biggest challenges for the region also appears to be one of its biggest opportunities: aligning infrastructure with sustainability.
  

Bonnie Saynay, Global Head of ESG Investor Research at ISS ESG, said: “Our new report demonstrates how ISS ESG’s proprietary data and the experts on our research team, with significant capital markets experience and sectoral expertise, helps support investors in evaluating and prioritizing complex and diverse regional ESG risks and investment opportunities.”

To download a copy of the full report, please click here.

About ISS ESG
ISS ESG solutions enable investors to develop and integrate sustainable investing policies and practices, engage on sustainable investment issues, and monitor portfolio company practices through screening solutions. It also provides climate data, analytics, and advisory services to help financial market participants understand, measure, and act on climate-related risks across all asset classes. In addition, ESG solutions cover corporate and country ESG research and ratings enabling ISS ESG clients to identify material social and environmental risks and opportunities. For more information, please visit us at: www.iss-esg.com

Media Contact:
Sarah Ball
Executive Director, Communications, ISS
+44.203.192.5728
sarah.ball@issgovernance.com