Even as sustainable investing becomes a political football in the United States, pension funds and other asset owners in Europe and North America are adopting sustainable investment practices for their portfolios, according to a recent study by Morningstar Indexes.
Based on interviews conducted with a select group of asset owners, findings in the “Voice of the Asset Owner” survey generally saw investing using environmental, social, and governance metrics “as a core element of investing rather than a specialist niche,” according to the study.
The respondents said their use of ESG was driven by both client demand and their conviction in the strategy. They used ESG factors because of wider public awareness and support, as well as regulation that endorses asset owners taking a broader view of their responsibilities, particularly in Europe. “Before, it was globalization, efficiency,” one asset owner said. “Now, it is more emphasis on resiliency than efficiency.”