ISS ESG Report Assesses Key 2023 ESG Opportunities and Risks for Investors at Mid-Year Mark

Report reviews mid-year trends of investor focus likely to impact portfolio risk-return

NEW YORK (July 19, 2023) — ISS ESG, the sustainable investment arm of Institutional Shareholder Services Inc. (ISS), today released Actionable Insights: Top ESG Themes in 2023 — Mid-Year Review, as a complement to its Actionable Insights: Top ESG Themes in 2023 — Global Edition report published in January. 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 assess the extent to which key ESG risks and investment opportunities, identified in January as likely to impact their portfolios in 2023, have been actionable so far this year. It is the third and final report in our Actionable Insights series.

Following the form of a “catalogue of mid-year reviews,” each of the chapters in the original report has been reviewed in the new report according to an identical structure. This approach examines notable developments in the first half of 2023 and then details expected implications for investors in the second half of 2023.

Key takeaways from ISS ESG mid-year analysis include:

• Change usually happens slowly in the global regulatory world, but recent regulation related to ESG investing is accelerating the pace of change, even as regulators simultaneously advance new requirements and, in some cases, revisit existing regulation.
• Progress toward decarbonization remains slow, both because of limited adoption by companies of meaningful Net Zero targets, and because of a lack of consensus regarding alternative technologies such as nuclear power and carbon capture and sequestration. However, investor appetite for Net Zero data is increasing exponentially.
• The ideas of transforming agriculture to prevent biodiversity loss and mitigate climate change, and providing adequate public and private mental health services have received global support from international bodies such as the Intergovernmental Panel on Climate Change and the World Health Organization.
• A full-blown recession has not yet occurred. However, an uninspiring low-growth environment, combined with elevated inflation and interest rates, and tighter liquidity caused by a recent banking crisis, led to some outperformance, especially in the Technology sector.
• Russia’s invasion of Ukraine and the resulting economic sanctions continue to be a significant influence on the ESG investing landscape. The short-term prospect of a diplomatic resolution remains slight.

Bonnie Saynay, Global Head of ESG Investor Research at ISS ESG, said: “In the latest report, ISS ESG’s proprietary data and research team, with significant capital markets experience and sectoral expertise, holds its analysis to account six months on, to provide structured, actionable intelligence and support for investors, helping them to evaluate and prioritize complex 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 responsible investment issues, and monitor portfolio company practices through screening solutions. ISS ESG 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