Survey shows diverging views on ESG usage

Over 70% of institutional investors use environmental, social and governance (ESG) principles as part of their decision-making process, according to a new survey by RBC Global Asset Management (RBC GAM), but there are still diverging views on ESG usage.

The RBC GAM 2019 Responsible Investing Survey found the top-cited reason investors in the US, UK and Canada went for an ESG-based approach was for a positive performance impact that mitigated risk and enhanced returns.

Regionally, the respondents who reported using ESG principles ‘significantly’ over ‘somewhat’ rose 3% that year in the US, 5% in Canada and 30% in the UK.

However, the survey revealed a divergence of views about the value of ESG performance, with ‘significant’ voters having the greatest confidence, but the full survey sample expressed doubts.

Those who believed an ESG portfolio would perform worse than a non-ESG portfolio rose from 10% to 18%, but out of ‘significant’ voters, 98% believed it would perform better than a non-ESG portfolio.

Of the ranked ESG issues investors were concerned about, cyber security ranked first globally at 67%, with anti-corruption at 66%.

The data also showed that investors preferred engagement over divestment when it came to engaging with corporate management.



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