As interest in sustainable investment moves to the forefront, asset managers are enhancing talent and adding capabilities to their fund lineups to better measure impact.
What is driving the move toward sustainable investing? Customer demand! As recently noted in FundFire, "Impact investing will see increased flows from asset owners over the next 12 to 18 months, including high-net-worth individuals and institutional players, says Fran Seegull, executive director of the U.S. Impact Investing Alliance..."
Who is focusing here? All investment companies are taking notice: from smaller niche players exclusively focused on ESG to behemoths like BlackRock, the world's largest fund management company.
Why now? Shifting preferences, a push from millennial investors, and enhanced alpha generation.
ESG investing has evolved from exclusion and elimination (i.e.: values-based constraints on investment opportunities) to a more integrated and holistic approach and most recently affirmative impact.
Impact investors want the most alpha-generative opportunities, that still fulfill a broader social mission, while mitigating systemic risks to the environment, like carbon emissions, or the economy, like poor corporate governance.
How do you achieve this? With the right team to deliver on those ESG and Impact aspirations. On the investor side, building an integrated analytical research process is critical. That means having investors at all levels measuring impact as a value-add function. Support teams, portfolio analytics groups, quants, and data scientists can augment and improve visibility for fundamental teams. On the distribution side, adding executives that understand how to value and articulate the impact beyond ROI is necessary for success. Marketers who can shape the story along with product executives who help implement the right strategy lay the foundation for success in ESG investing.
We at Calibre One can help. We have been active in the ESG/Impact space working with companies to attract senior investment leadership as well as product, marketing, and distribution professionals. Please reach out to learn more. http://www.calibreone.com/
fund managers to consider environmental, social, and governance (ESG) criteria in their investment decision-making process