The increase awareness on the importance of sustainable living has influenced people to be more mindful about making sustainable choices in their daily lives, for example: recycling household waste, practising upcycling & reusing items, choosing organic food and opting for greener ways to travel wherever possible.
Other than what is happening in our daily lives, other global challenges like inequalities, deforestation, climate change and the pandemic have also brought attention to both corporates and individuals on the importance of sustainable development to achieve a better and sustainable future for all.
Today, what’s interesting is that investors have the ability to influence how government and corporates alike can make changes in the way they operate, in order to address sustainability concerns. A research by EY1 showing that an increasing number of people no longer select investments based solely on the ability to generate financial returns but rather sustainable solutions that reflect in their values and make a contribution to the community and world.
Below are some commonly-considered ESG factors:
E = Environmental
What impact does a company have on the environment? This can include a company’s carbon footprint, toxic chemicals involved in its manufacturing processes and sustainability efforts that make up its supply chain.
S = Social
How does the company improve its social impact, both within the company and in the broader community? Social factors include everything from human rights, racial diversity within hiring and inclusion programs, the health and safety of its employees and board members, and community engagement.
G = Governance
How does the company’s board and management drive positive change? Governance includes everything from issues surrounding executive pay to diversity in leadership, shareholder rights, overall transparency and disclosure, and anti-corruption.
Some interesting facts
It is important to note that portfolio returns are not being sacrificed to perform ESG integration techniques. On the contrary, the main objective of ESG integration is to lower risk and/or enhance returns.
Our Investment Solution - Hong Leong Global ESG Fund
Hong Leong Global ESG Fund is a global equity fund aiming to provide medium- to long-term capital growth by investing in a globally diversified portfolio of companies with a focus on ESG criteria in the investment process.
To add to that, Hong Leong Global ESG Fund is also a qualified Sustainable and Responsible Investment Fund (“SRI Fund”) under the Securities Commission Malaysia’s Guidelines on Sustainable and Responsible Investment Funds.
Source:
1 https://www.ey.com/en_my/financial-services/why-sustainable-investing-matters
₂ https://www.gobyinc.com/esg-sri-sustainable-investing-differences/
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DISCLAIMER:
This article has not been reviewed by the Securities Commission Malaysia. Investors are advised to read and understand the contents of the Hong Leong Global ESG Fund Prospectus dated 20 April 2022 (known as the “Prospectus”) and the Product Highlight Sheet (“PHS”) before investing.
The data and content presented in this article are for information purposes only and are not a recommendation to buy or sell any securities or adopt any investment strategy. This material is not intended to be relied upon as a forecast, analysis, research, or investment advice regarding a particular investment or the markets in general, nor is it intended to predict or depict performance of any investment. The information in this article does not take account of any investor's investment objectives, particular needs or financial situation. You should consider whether an investment fits your investment objectives, particular needs and financial situation before making any investment decision.