Green Finance Advisor of Friends of the Earth (HK) / 香港地球之友綠色金融顧問
March 2020 will go down in history as one of the most intense and sharpest sell offs people have ever experienced due to the Covid-19 outbreak worldwide. The MSCI World stock index fell by 14.5 per cent, meanwhile, according to Morningstar, 62 per cent of global environmental, social and governance-focused large-cap equity funds outperformed the benchmark. In hindsight, it would be interesting to backward-engineer the reasons behind the outperformance amid the public health crisis, which may shed more lights on how investors should perceive ESG investing, especially for “S”, which the traditional financial analysis used to understate its importance.
On top of the consideration of companies’ financial strength by ESG strategies given its quality bias, the enhanced risk management framework with the outright focus on ESG factors could have aided companies’ performance the difficult market environment. The pandemic has underlined the importance of disaster preparedness, continuity planning and employee treatment through benefits, as they would determine whether a business can continue its operations amid the lockdowns and social distancing, posing important implications for their performance. Meanwhile, many companies such as HKTV and other MNC also manufacture medical supplies, it highlights the role that private companies could play in addressing social problems, demonstrating that corporate reputation has been strongly positively correlated to financial performance.
Most importantly, the vision behind ESG investing rides on how the economy is being reshaped at the moment in order to accommodate the public health crisis. To combat the spread of the coronavirus, the global economy is severely impacted with the regional lockdowns and social distancing in place. The changing backdrop highlights the importance of sustainability and companies’ ability to adapt to changes in the societies to which they belong, as none of the companies can completely shrug off the impact from social or environmental changes. It is natural that ESG would outperform as sustainable investment takes into account the future and positive social impact, this manifests itself in the growth of the telecommuting company “Zoom” which many of us may be using now when considering the social benefits it delivers.
A wide range of social and environmental issues will reach their critical points in the coming decade, such as climate change, political stability and the future industrial revolution driven by technological advancement. Companies’ fortunes will hinge on whether they can weather these disruptive challenges in future. From investors’ perspective, as we can envisage that the increasing risks stemmed from environmental and social issues would be moving up corporate agendas to drive long-term development plans, we have to examine companies and identify winners among them.
虧得新型冠狀病毒於全球爆發，相信2020年3月將成為人類歷史上經歷過的最激烈、最緊張的拋售之一。MSCI全球指數下跌了14.5％，但與此同時，據Morningstar報道，全球62％以環境、社會與管治為重點的大型股本基金表現勝過標準。現在看來，事後探討在公共衛生危機中仍能維持良好表現的背後原因是有趣的，因為這有可能為投資者提供更多啟示，提示他們該如何看待曾被傳統財務分析低估重要性的環境、社會與管治(ESG)投資，特別是當中的「社會(S)」。
除了考慮將有可能牽涉到質素偏差的ESG策略對公司財務實力的影響外，完全側重ESG因素的風險管理加強框架可能更有助公司於艱難的市場環境中維持運作。這場傳染病大流行反映了備災、可持續性計劃和給予員工津貼的重要性，因為這些因素將決定企業能否在全球封鎖和保持社交距離的情況下繼續經營，並對其業績構成重要影響。同時，很多公司，如香港電視(HKTV)和其他跨國公司也在生產醫療用品，這凸顯了私營公司在解決社會問題中可以發揮的作用，亦顯示了公司聲譽與財務業績之間存在著顯著和正面的相互關係。
更重要的是，環境、社會與管治(ESG)投資背後的主要目標是在現階段適應公共衛生危機下如何重塑經濟。為了對抗新型冠狀病毒的傳播，全球經濟受到區域性封鎖及強制保持社交距離的嚴重影響。不斷變化的環境因素反映可持續性和公司適應其所屬社會變化的能力的重要性，因為沒有一間企業能夠完全擺脫社會或環境變化的影響。由於可持續投資會考慮未來和積極的社會影響，ESG的表現突出是理所當然的，這些好的表現充分體現在遙距工作資訊技術公司Zoom的業務增長中。現在有很多人都在使用它，就是因為考慮到它帶來的社會效益。
在未來十年內，各式各樣的社會和環境問題將會達至臨界點，當中包括氣候變化、政治穩定性以及由技術演變所推動的未來工業革命。一眾公司的命運將取決於能否在未來應對這些顛覆性的挑戰。從投資者的角度來看，由於我們可以預見在不久的將來，環境和社會問題所帶來的日益增加的風險會被視作公司的重要事項，並促使企業制定長期發展計劃，因此，我們必須積極研究各企業並尋找當中的「贏家」。
