Below is an excerpt from ISS ESG’s thought leadership paper “Legal Sins – Is There Value in Vice?”. The full paper is available for download from the Institutional Shareholder Services (ISS) online library.
I think we can finally call it – responsible investment has gone mainstream.
According to the Principles for Responsible Investment, their signatories globally manage in excess of USD $100 trillion, and new signatories are coming on board at an increasing rate. Nevertheless, the PRI’s core principles are relatively broad in nature, and certainly not prescriptive in terms of what responsible investment methodology signatories should adopt.
While mainstream financial players have clearly discovered the language of ESG integration and the potential for environmental and social factors to impact on portfolio returns, they still face challenges communicating about values. There are enthusiastic explanations of how far ESG integration has evolved from “ethical investment” and “negative screening,” however the mainstream of responsible investment still grapples with a core problem: their stakeholders still find values important.
By Duncan Paterson, Head of ESG Thought Leadership, Asia Pacific, ISS ESG