The global investment focus of shareholders, investors and fund managers shifted. We are seeing a transfer of wealth into the millennium, environmental disasters, the costs, and risks increase, and improved operating performance through sustainable practices. The importance of environmental governance, social and (ESG) factors in an investment decision, the Boston Consulting Group showed in their recent article; Investors Care About Sustainability More Than Many Believe Executive, that 75% of senior executives in the investment company saw as the material ESG factors important to their investment decisions.
If you want to know more, Visit the “esg investing System” or also browse online. In 2006 the United Nations Environment Program Finance Initiative and the UN Global Compact to develop Principles of Responsible Investing (PRI) and have been trying to get an autograph from leading financial institutions committed to adopting this principle. UN initiative identifies three classes of concern: the environment, social responsibility and issues of corporate governance (ESG). At the heart of this initiative is the belief that ESG issues affect corporate financial strength. In addition, the fiduciary duty of institutional investors to consider ESG issues when choosing investments.
A common concern for investors is whether the growth of their portfolio will suffer from the application of the principles of responsible investment. After all, we are investing to preserve and increase wealth. Considering that the general methodology applied to responsible investing is to first identify the company that sounds investment for financial reasons and then evaluates the performance of ESG them, companies that hold this examination and stand out among their peers are better situated to succeed in the global economy.