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Investing in the Highest Ethical Standards


INVESTING IN THE HIGHEST ETHICAL STANDARDS

alex-ng

Alex Ng
Chief Investment Officer, APAC
BNP Paribas Asset Management

Spurred by the advent of new Environmental, Social and Corporate Governance (ESG) products, ethical investing has garnered considerable attention from investor circles in recent years. In the vanguard of this movement is BNP Paribas Asset Management (BNPP AM). In its 20-odd years of managing Sustainable and Responsible Investments (SRI) – the firm was one of the first asset managers to create a dedicated ESG research team in 2002 – BNPP AM has demonstrated that compelling fund returns and sustainable investing can go hand in hand. Mr. Alex Ng, Chief Investment Officer, APAC, at BNPP AM explained the team’s role in stewarding clients’ capital.

BENCHMARK (BM): BNPP AM prides itself on being a responsible asset manager. What drives your ESG commitment?
Alex Ng (AN): Ever since we started our first ESG-integrated mandate in 1997, our commitment to sustainability and ESG issues has been central to the way we conduct our business. As early as 2006, we became a signatory of the Principles for Responsible Investment (PRI). Later, in 2011, we ingrained our “Responsible Investment Policy” into our fund management. From then onward, all our open-ended funds began to adhere to ESG best practices, with specialized correspondents assigned to every investment team to oversee the inclusion of sustainable thinking.
At BNPP AM, “investing means the world to us” is more than a mere slogan. This commitment to investing responsibly is founded on our belief that profit-making is not the be-all and end-all of investing. We, as responsible investors, need to take a more holistic approach to asset management. To us, this vision is not just about embracing social values and addressing universal concerns that we share with the global community; it is also about investing in a brighter future, the prospect that we could bring about long-term rewards for both our clients and the wider society. Our passion for investing and sustainability is succinctly summarized by our tagline: “Investing means the world to us.”
BM: Would you say that integrating ESG factors into your investment process is more of a risk-management consideration than a return-enhancement strategy? Can ESG engagements be a profit driver?
AN: That’s a good question. According to the studies “From the Stockholder to the Stakeholder,” from the University of Oxford, and “ESG and financial performance: aggregated evidence from more than 2000 empirical studies,” from the University of Hamburg, despite the proven positive correlation between sound sustainability practices and stock-price performance, the misconception that integrating ESG factors would hinder portfolio performance still pervades the investment world.
At BNPP AM, we believe that incorporating ESG factors as a complementary investment filter to aid conventional financial analysis via an understanding of the relevant environmental, social, and governance challenges can help asset owners make better-informed decisions. Therefore, we see ESG integration as both a risk-mitigating tool and a potential return enhancer. While avoiding exposure to companies with subpar ESG standards – particularly in corporate governance – helps us reduce the risk of significant drawdowns, we also find that companies with sound ESG practices tend to demonstrate better business performance, which, in turn, can lead to better stock-price performance over the long term.
BM: We’re seeing an increasing number of Asian money managers advocating SRI. Do you think SRI could be a lasting investment theme in Asia? What kinds of challenges are the most common for Asian ESG managers?
AN: Without a doubt, we’re witnessing a growing interest in sustainable investment in Asia. This is an encouraging trend, especially since Asian investors were, until recently, relatively lukewarm to the idea of sustainable investing. According to the Global Sustainable Investment Review 2016, although the number of assets professionally managed under responsible investment strategies represented 26.3% of the total managed assets worldwide, in Asia, SRI investments only represented 0.8% of the total managed assets, showing that there is still much room for growth in Asia’s SRI market. Among the various sustainable investment strategies on our shelf, we have observed the greatest interest in thematic strategies related to sustainability problems, such as water, climate change, resource efficiency, and food supply.
As many Asian companies are not yet familiar with the concept of sustainable investment, one of the main challenges we face is information collection. In our experience, some companies are still reluctant to disclose ESG-related information, let alone engage with investors to drive positive changes. As the demand for SRI gains steam in Asia, we hope that companies will take even greater initiative to facilitate ESG investment in the future. BM

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投資於最高道德標準

alex-ng

亞太區投資總監黃金源
法國巴黎資產管理

惠於環境、社會及管冶(Environmental, Social and Corporate Governance,簡稱「ESG」)產品的出現,道德投資近年受到不少投資者的關注。法國巴黎資產管理正是當中的佼佼者。他們一早洞識先機, 早於2002 年成為首批設立可持續及盡責投資(Sustainable and Responsible Investment,簡稱「SRI」)研究團隊的公司,迄今已累積了近20 年管理經驗。法國巴黎資產管理充分展示了可觀的基金回報及可持續投資可以齊頭並進。法國巴黎資產管理的亞太區投資總監黃金源,更闡明其團隊於管理客戶資金時所擔當的角色。

《指標》:法國巴黎資產管理以盡責資產管理者的身份引以為榮。甚麼是推動可持續及盡責投資承諾的動力?
黃金源: 從1997 年開始首個融合ESG的投資以來,我們對可持續性及ESG的承諾已成為業務的核心。早於2006 年,我們成為責任投資原則(The Principles for Responsible Investment)的簽署者。於稍後的2010 年,我們將「盡責投資政策」植根於基金管理的概念之中。自此,我們的開放式基金便開始實踐ESG的最佳運作方式,並派遣ESG專門人員到每支投資團隊,確保將可持續思想引入投資過程。
於法國巴黎資產管理,「投資對我們而言就是全世界」這口號並非空談。盡責投資此承諾是基於“創造盈利並非投資的全部”此信念。作為一位盡責投資者,需要利用更全面的方法管理資產。對我們而言,此概念不單止遵從社會價值及解決各地社會所關注的問題,而是投資於更光明的未來,令我們可以為客戶及社會帶來長期的回報。我們對投資及可持續性的熱誠,正於「投資對我們而言就是全世界」這口號中反映。
《指標》:你會否同意於投資過程中結合ESG因素,是出於風險管理的考慮,多於增加收益的策略?結合ESG的因素是否可以帶動盈利?
黃金源:黃金源:這是個好問題。根據牛津大學的研究《由持股者到持份者》及漢堡大學的《ESG與經濟表現:來自2,000 多個實證研究的證據》,即使有理據支持良好的可持續作業方式與股價表現有正面關係,於現實投資中,不少人仍有存在「結合了ESG因素,會阻礙投資組合表現」的誤解。
於法國巴黎資產管理,我們相信將ESG因素以過濾器的形式協助傳統的金融分析,有助了解相關環境、社會及管治的挑戰,從而令資產持有人做出更明智的決定。因此,我們認為ESG的融合,是規避風險及強化潛在回報的工具。正當我們避免投資低於ESG標準的公司(尤其於管冶方面),我們也察覺到擁有良好ESG運作方式的公司,會有更理想的業績。長遠而言,會有較佳的股價表現。
《指標》:我們看到越來越多亞洲資產管理人提倡可持續及盡責投資,你認為可持續及盡責投資會否成為亞洲的持續投資趨勢?亞洲的ESG管理人普遍會面對甚麼挑戰?
黃金源:無可否認,我們見證着可持續投資的興起。這是個令人鼓舞的趨勢,尤其是亞洲投資者過去對可持續投資的興趣較淡。根據《全球可持續投資評論2016》,雖然全球以盡責投資策略管理的資產佔管理總資產的26.3%,亞洲市場此等投資只佔同區管理總資產的0.8%。換句話說,亞洲的可持續及盡責投資市場,仍有很大的增長空間。於法國巴黎資產管理眾多的盡責投資策略中,我們留意到投資者最感興趣的策略,多與可持續性問題有關,例如水、氣候變化、資源效益及食物供應等。
由於不少亞洲企業對可持續投資的概念認識尚淺,我們面對其中一個最大難題正是資料蒐集。根據我們的經驗,某些公司仍對公布ESG相關的資訊有所保留,更不用說促使投資者採納ESG觀念實現正面的轉變。由於可持續及盡責投資的需求持續增長,我們期望各企業採取更大的主動性,在未來落實ESG投資。BM

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