Capital Markets Are To Be Affected By ESG Trends In 2017
Dailycsr.com – 27 February 2017 – The year of 2017 serves as a module as right from the beginning institutions are increasingly taking interest in making long-term investments, writes Vikas Vij. Moreover, policy makers and investors alike have shown little inclination towards “short-termism”. Investors that are linked with institutions stand a better chance in efficient management of economy risks by engaging in collaborations, whereby strengthening “market standards in environmental, social and corporate governance (ESG) areas”.
“2017 ESG Trends to Watch” is a new research documents published by MSCI which speculates on effects of “major ESG trends” on capital markets in the coming years, whereby the same report states that in the year of 2017, some of the “largest investors” in the world are likely to begin a trend by shifting their focus on “the long view”.
According to the researchers, the investors are going to fix their attention in the near future for mitigating the physical risks’ exposure in terms of climate change, the matter of water scarcity topping the list. In the capital markets of Asia, corporate governance will grab the lime light in the year of 2017, while codes promoting investors and Asian companies’ engagement could a “adopted” in a rapid manner. While, Vikas Vij adds:
“In 2017, institutional investors may apply more differentiated and targeted strategies to integrate ESG signals across asset classes, markets and factor exposures. The researchers also see increased adoption of corporate disclosures targeting UN Sustainable Development Goals as a boost for institutions that aim to broaden their programs for impact investing”.
When it comes to India and China, both the countries will see a converging of global and domestic standards in this year as the companies rooted in these two countries tread deeper water to create a better “understanding of standards” those needed for convincing “sustainable finance from international investors”.
In fact, MSCI also thinks that the year of 2017 could boost the growth of ESG, while only last year a “series of research papers” demonstrated the “virtues embedded in ESG signals”. Associates of Cambridge discovered that ESG has a “stronger contribution” to make in the companies’ performances especially in the “emerging markets” in comparison to developed ones.
On a concluding note, Vij stated:
“Research by Barclays has found that governance factors could be linked to credit performance. Strong management quality is likely to result in greater fiscal responsibility and fewer credit downgrades. Both studies show that ESG signals are nuanced, and selective application may be more effective than a blanket approach”.
References:
http://www.ethicalperformance.com
“2017 ESG Trends to Watch” is a new research documents published by MSCI which speculates on effects of “major ESG trends” on capital markets in the coming years, whereby the same report states that in the year of 2017, some of the “largest investors” in the world are likely to begin a trend by shifting their focus on “the long view”.
According to the researchers, the investors are going to fix their attention in the near future for mitigating the physical risks’ exposure in terms of climate change, the matter of water scarcity topping the list. In the capital markets of Asia, corporate governance will grab the lime light in the year of 2017, while codes promoting investors and Asian companies’ engagement could a “adopted” in a rapid manner. While, Vikas Vij adds:
“In 2017, institutional investors may apply more differentiated and targeted strategies to integrate ESG signals across asset classes, markets and factor exposures. The researchers also see increased adoption of corporate disclosures targeting UN Sustainable Development Goals as a boost for institutions that aim to broaden their programs for impact investing”.
When it comes to India and China, both the countries will see a converging of global and domestic standards in this year as the companies rooted in these two countries tread deeper water to create a better “understanding of standards” those needed for convincing “sustainable finance from international investors”.
In fact, MSCI also thinks that the year of 2017 could boost the growth of ESG, while only last year a “series of research papers” demonstrated the “virtues embedded in ESG signals”. Associates of Cambridge discovered that ESG has a “stronger contribution” to make in the companies’ performances especially in the “emerging markets” in comparison to developed ones.
On a concluding note, Vij stated:
“Research by Barclays has found that governance factors could be linked to credit performance. Strong management quality is likely to result in greater fiscal responsibility and fewer credit downgrades. Both studies show that ESG signals are nuanced, and selective application may be more effective than a blanket approach”.
References:
http://www.ethicalperformance.com
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