ESG boosting returns, finds SSGA

By Tim Stewart
 — 1 minute read

Just over a quarter of professionally managed assets worldwide now have an environmental, social and governance (ESG) overlay – and fund managers are happy with the results, according to a new report.

State Street Global Advisors commissioned Longitude Research to gauge the opinions of senior executives about ESG at 475 investment institutions in the Asia-Pacific region, the United States and Europe.

The resulting report, Performing for the Future, found that throughout 2016, ESG investing accounted for US$22.9 trillion, or just over a quarter, of the world's professionally managed assets.


Of the 475 executives surveyed, 80 per cent said their institution had some form of ESG strategy within its portfolios.

Furthermore, 68 per cent of respondents said the integration of ESG within their portfolios had significantly improved returns, and 69 per cent said ESG had helped them manage volatility.

However, it appears many of the so-called non-adopters’, who make up 20 per cent of the total respondents, are digging their heels in, with 71 per cent of them stating they were not actively considering ESG.

One of the key barriers to more widespread ESG adoption, according to the report, is the need for appropriate ESG benchmarks.

Thirty-three per cent of respondents agreed somewhat that they have difficulty benchmarking their performance against their peers, and 24 per cent agreed with the statement ‘strongly’.

“While there is a sense among investors that current difficulties around performance assessment are part of the evolution process for what is a relatively new investment framework, it’s clear that the inconsistency of measures leads to a degree of frustration and constitutes a barrier for further adoption of ESG,” the report said.

Read more:

Equity markets boost super fund returns

Smarter Money Investments gets Lonsec tick

Cyber risk a top concern for ASX 100 boards

Investment analyst joins 4D Infrastructure

IFM Investors partners with Samsung AM

The must-attend event for financial advisers is back in 2022: the ESG Summit, coming to Sydney and Melbourne in February. Walk away with vital knowledge on a number of key ESG areas to help you make informed ESG strategy decisions and to better communicate and integrate the growing ESG space to clients. Visit the website to secure your place.


ESG boosting returns, finds SSGA
esg, boosting, returns
ID logo


related articles

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.