HSBC study points to stalling global investor interest in ESG

illuminem summarizes for you the essential news of the day. Read the full piece on Bloomberg or enjoy below:

🗞️ Driving the news: Investor interest in ESG (Environmental, Social, and Governance) is stalling as fund managers navigate a challenging political and economic climate, according to an HSBC survey
• The survey of 150 firms managing $6.7 trillion in assets found weakened reasons for monitoring ESG risks, though sustainability remains an objective for many funds

🔭 The context: The findings align with a broader trend of cooling interest in ESG, influenced by backlash in the US and poor returns in sectors like solar and wind
• ESG fund launches are declining, and redemptions continue, as managers adopt thematic investing as an alternative

🌍 Why it matters for the planet: The retreat from ESG investing could undermine efforts to address long-term sustainability challenges, especially as water-related risks remain under-appreciated by many investors

⏭️ What's next: The survey indicates a need for more uniform ESG norms and regulations, with 60% of respondents advocating for a global approach. Investment strategies may increasingly incorporate ESG elements under different labels to attract capital

💬 One quote: “Global events continue to distract from long-term sustainability challenges,” said Wai-Shin Chan, HSBC’s head of ESG research

📈 One stat: Close to 60% of survey respondents said a global, firm-wide approach to ESG or sustainability is needed

Click for more news covering the latest on sustainable finance