Green Finance Advisor of Friends of the Earth (HK) / 香港地球之友綠色金融顧問
According to various reports, ESG equity funds, despite falling, have outperformed the peers. Specifically, majority of the sustainable index funds, whether in developed markets or in the emerging markets, have been holding up better than the traditional index funds, of which the prices declined even more. This could be contributed to the fact that many of these ESG funds has little or no investment to energy, airlines and resources companies, which are among the worst performers in the stock market since this pandemic outbreak.
While minimizing exposure to companies with high carbon footprint is important, there are a lot that investors can do in sustainable investing. Avoiding risks and getting positive financial return is certainly important. But investors who care about ESG and sustainability would also want to bring positive social and environmental impact through companies they invest. We doubt this purpose can be effectively achieved through the current approach of most indexed funds or passive funds. These funds could be doing performing fairly well by avoiding fossil fuels and other so-called sins stocks by adopting negative / exclusionary screening. However, how much time and resources they spent in understanding the sustainability strategies of companies and engaging with them on improving their ESG metrics is the question.
Some investors were not necessarily interested in companies’ business model and process but just wanted to check their internal framework to demonstrate that they had completed their due diligence. This approach is hard to result in positive changes for companies, environment or society. On the other hand, a more value adding, constructive approach, i.e. active engagement, is preferred for investors and companies to advance. Active engagement can help companies better manage ESG issues and understand both the risks and the opportunities arising from sustainability development. Investors can learn the issues that companies and their businesses encounter and solidify their confidence in the companies in which they invest. The mutual learning process should be on-going and fruitful, resulting in long-term value creation for both parties. How much effort is put to engaging companies for positive changes and opportunities exploration in ESG? This is a question that investment managers have to ask themselves.
Passive funds, particularly ETFs, are popular for compelling reasons. Low cost and tax efficiency are certainly major benefits for investors. Thanks to the development of passive funds and ETFs, the barrier for ESG investing is lower and more people and capital that care about social responsibility and sustainability can participate. Corporates seeing this rising trend will also be more aware of ESG and will take the issue more seriously which is also a force for good. But another reason for investors choosing passive investment is the disappointment in the historical performance of the traditional active funds. The up and rising demand for ESG and sustainable investing is providing the opportunities for active managers to shine again ── only for those who do not deny climate change and take the sustainability subject seriously.
根據各種報告，儘管ESG股票基金價格下跌，但其表現卻優於同行。具體而言，無論是在發達市場還是在新興市場，大多數可持續指數基金的表現都優於傳統指數基金，後者的價格下跌幅度更大。這可能是由於許多ESG基金沒有持有或只持有少量能源、航空公司和資源公司的股票，這些行業都是自大流行爆發以來在股市中表現最差的行業。
儘管最大程度地減少對高碳足跡公司的投資很重要，但投資者在可持續投資方面可以做得更多。避免風險並獲得積極的財務回報固然也很重要，但是，關心ESG和可持續性的投資者也希望通過他們投資的公司帶來積極的社會和環境影響。我們懷疑通過目前大多數指數基金或被動基金的方法能否有效實現這一目的。通過採用否定/排除篩選，避免投資化石燃料和其他所謂的罪惡行業，這些基金可能會做得不錯。但是，他們花了多少時間和資源來了解他們所投資的公司的可持續發展戰略以及與他們積極交流以改善他們的ESG指標 ?
一些投資者不一定對公司的業務模型和流程感興趣，而只是想檢查其內部框架以證明他們已經完成了盡職調查。這種方法很難為公司、環境或社會帶來積極的變化。另一方面，對於投資者和公司而言，更可取的是積極跟公司溝通，以幫助公司更好地管理ESG問題，並了解可持續發展帶來的風險和機遇。投資者可以了解公司及其業務遇到的問題，並鞏固他們對所投資公司的信心。相互學習的過程應該持續進行並富有成果，從而為雙方創造長期的價值。為使公司參與ESG的積極變革和機遇探索付出了多少努力？這是投資經理必須問自己的問題。
被動型基金，特別是ETF，在過去幾年大行其道自有其吸引之處。低成本和稅收效率無疑有利投資者。得益於被動型基金和ETF的發展，ESG投資的壁壘更低，令更多關注社會責任和可持續性的人和資本可以參與ESG投資。看到這種上升趨勢的企業也將更加關注ESG，並將更加重視可持續發展，這能為ESG帶來正能量。但是，投資者選擇被動投資的另一個原因是傳統主動基金的過去表現令人失望。對ESG和可持續投資不斷上升的需求為主動基金提供了再次發光的機會──但僅適用於那些不否認氣候變化並認真對待可持續性主題的業者。
