Two new reports on environmental, social and governance investing show pensions and nonprofit firms’ greatest ESG interests, while another report shines a light on which firms are living up to ESG expectations, and which aren’t.
Social investing seems to be the most active area of ESG for pension and nonprofit funds, according to a report by Escalent, a human behavior and analytics firm specializing in industries facing disruption and business transformation.
Social investing was defined as pertaining to diversity, human rights and consumer protection. The report notes a special interest in this area was by tax-exempt organizations and investors representing public defined benefit and Taft-Hartley Act pensions.
According to the paper, institutional investors area taking a “first, do no harm” approach by avoiding those firms that are having problems or bad publicity. It does note that they see corporations recognize the growing trend toward ESG.
“Given this increasing momentum along with the challenge many asset managers face in effectively differentiating themselves in the institutional market, ESG investing could be a means of gaining a considerable advantage,” Escalent stated in the report.
Ins and Outs for Climate Change
In other ESG news, Legal & General Investment Management released its 2019 LGIM Climate Impact Pledge report on corporate leaders and laggards for climate change. The investment firm divests those companies from their fund that don’t follow those practices.
Top global firms noted in the report that have strengthened aspects to reduce climate change include General Mills, Citigroup & Xcel Energy.