Survey Reveals ESG Data Adoption Drivers and Challenges in China
A survey conducted at the Bloomberg Sustainable Finance Forum in Shanghai, gathering over 150 responses from professionals in banking, insurance, securities, and technology, has identified new drivers and challenges related to the adoption of ESG data in China.
The reasons for adopting ESG data were diverse. Regulatory requirements were the top motivator (25%), followed closely by demands from onshore clients (21%), offshore clients (21%), and internal risk management (22%). This pattern mirrors the findings from Bloomberg’s earlier European ESG Data Trends Survey, where regulatory compliance was also the foremost reason (35%).
Chinese market participants are integrating ESG considerations into their decision-making in various ways. The survey showed a balanced distribution of use-cases, including third-party ratings and research (20%), impact investing (19%), and building quantitative strategies incorporating ESG data (18%). Consideration of climate risks (16%) and biodiversity (9%) is also on the rise among Chinese firms.
However, significant challenges remain in the use of ESG data. The primary concern for 62% of respondents was the quality and coverage of company-reported data. The second major challenge was integrating ESG data with alternative data (26%). These findings are consistent with the European survey, indicating a global need for standardized ESG data reporting.
Managing ESG data poses further difficulties. About 31% of respondents reported challenges with handling multiple ESG vendor feeds, a contrast to 16% in the European survey. Additionally, 35% of Chinese respondents found linking ESG data to existing entity or instrument data to be a major hurdle.
Patricia Torres, Global Head of Sustainable Finance Solutions at Bloomberg, noted the significant demand for high-quality ESG data and the evolving role of sustainability in Chinese financial markets. She emphasized the growing alignment between investor demands and regulatory drivers in the use of ESG data. Firms that develop capacity to effectively manage ESG data will have a competitive advantage, with ESG’s role in China’s financial markets expected to increase over time.
Bloomberg offers a comprehensive suite of sustainable finance solutions, including ESG data and analytics, indices, scores, regulatory solutions, sustainable debt, and climate risk assessments. Bloomberg Terminal users have access to ESG research from Bloomberg Intelligence and BloombergNEF, and can utilize ESG data via {ESGD <GO>} on the Terminal or through Data License for enterprise applications. Through Data License Plus (DL+) ESG Manager, Bloomberg enables clients to maximize the value of ESG data in their workflows by connecting them to a vast array of Bloomberg’s datasets and those from vendor partners.
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The reasons for adopting ESG data were diverse. Regulatory requirements were the top motivator (25%), followed closely by demands from onshore clients (21%), offshore clients (21%), and internal risk management (22%). This pattern mirrors the findings from Bloomberg’s earlier European ESG Data Trends Survey, where regulatory compliance was also the foremost reason (35%).
Chinese market participants are integrating ESG considerations into their decision-making in various ways. The survey showed a balanced distribution of use-cases, including third-party ratings and research (20%), impact investing (19%), and building quantitative strategies incorporating ESG data (18%). Consideration of climate risks (16%) and biodiversity (9%) is also on the rise among Chinese firms.
However, significant challenges remain in the use of ESG data. The primary concern for 62% of respondents was the quality and coverage of company-reported data. The second major challenge was integrating ESG data with alternative data (26%). These findings are consistent with the European survey, indicating a global need for standardized ESG data reporting.
Managing ESG data poses further difficulties. About 31% of respondents reported challenges with handling multiple ESG vendor feeds, a contrast to 16% in the European survey. Additionally, 35% of Chinese respondents found linking ESG data to existing entity or instrument data to be a major hurdle.
Patricia Torres, Global Head of Sustainable Finance Solutions at Bloomberg, noted the significant demand for high-quality ESG data and the evolving role of sustainability in Chinese financial markets. She emphasized the growing alignment between investor demands and regulatory drivers in the use of ESG data. Firms that develop capacity to effectively manage ESG data will have a competitive advantage, with ESG’s role in China’s financial markets expected to increase over time.
Bloomberg offers a comprehensive suite of sustainable finance solutions, including ESG data and analytics, indices, scores, regulatory solutions, sustainable debt, and climate risk assessments. Bloomberg Terminal users have access to ESG research from Bloomberg Intelligence and BloombergNEF, and can utilize ESG data via {ESGD <GO>} on the Terminal or through Data License for enterprise applications. Through Data License Plus (DL+) ESG Manager, Bloomberg enables clients to maximize the value of ESG data in their workflows by connecting them to a vast array of Bloomberg’s datasets and those from vendor partners.
Click here know more.
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