The E in ESG: Environmentally Conscious Investing

Is it possible to mitigate climate change issues through sustainable investing?

The growing global unease around climate change has had its impact in the investment world, with increased interest in sustainable investing. This has been partly enabled by the increased availability of material, non-financial data commonly referred to under the umbrella of ESG, or environmental, social and governance criteria.

According to the Global Sustainable Investment Alliance, sustainable assets under management increased from USD 14 trillion in 2012 to USD 22 trillion in 2016.

It is clear that attitudes towards sustainable investing are changing, moving away from a niche investment strategy to a new standard for investment management.

At UBS, we made a strategic decision to bring sustainable investing into the mainstream of our offerings. However, while creating positive environmental and social impact, we are also determined to realize the investment goals of our clients. We're working to construct sustainable equity portfolios that have a mix of investments that align with sustainability priorities, considering companies that have both attractive valuations based on their financials, and high sustainability scores based on their ESG profile. We strive to offer our clients innovative products and services in investment, financing and research, such as our Climate Aware indexing capability.

The need to consider environment issues while investing is of utmost importance. So, we at UBS decided to look into the E of ESG, to understand what it means to invest sustainably, why it is so important today and how it can impact the environment.

Speaking with Michael Baldinger, Head of Sustainable and Impact Investing at UBS, and other leaders in our team, we explore the steps taken at UBS to assess and protect our clients from climate-related risks, and maximize their investment returns while creating positive environmental and social impact.

The conversation is now

Investors often think of SI in terms of ESG – environmental, social and governance factors. Together these make up the fundamental framework for measuring sustainable investments. We take a look at the 'E' and why it matters.