Asia-Pacific Head of Portfolio & Index sales Bloomberg Norman Tweeboom said that Australians are increasingly wanting to invest in companies that meet ESG fund standards.
“It’s that concept of investing in companies that are socially responsible, are ethical in the way they manage their business. They’ve applied stricter governance around the projects in which they raise money. Green bonds and anything that falls in that category is something where we see quite a bit of interest,” he said.
Mr Tweeboom said that Australians historically are familiar with ESG due to many companies in Australia being signatories of the UN PRI.
The UN PRI is the United Nations Principals of Responsible Investing and is an international network of investors who work to put the six principals of responsible investing into best practice for companies.
“Australians want to get exposure to those type of companies that run their business in a socially responsible, sustainable fashion that have an ethical lens in the way they manage their business,” Mr Tweeboom said.
Companies around the world are changing their practices to be in line with ESG standards and, ultimately, Mr Tweeboom said it is the right thing to do.
“We are even seeing the largest asset managers increasingly demand from the companies they invest in that they run their business in a more sustainable responsible fashion. It absolutely is a theme that we think will continue and it is ultimately the right thing to do,” he said.
Mr Tweeboom said that Bloomberg operates a fixed income ESG index as clients wanted the fixed income base but also wanted to incorporate measures of ESG risk.
“The growing usage of ESG-weighted indices in 2017 is a clear sign that the fixed income investor base is becoming more sophisticated in their ESG usage,” Mr Tweeboom said.
