JPMorgan says Asia’s sustainability funds could double

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Sustainability funds doubled in 2020 — and are set to double in Asia again, according to JPMorgan’s head of environmental, social and governance (ESG) research.

“We’ve seen the amount of asset under management dedicated to ESG investing double in the last year,” said Elaine Wu.

“We expect that to double again, in Asia, for the coming year,” she told CNBC’s “Capital Connection” on Monday.

Two reasons account for the growth in sustainable investment funds, according to Wu.

The first is that regulators in Asia are requiring public companies to disclose their ESG data. Second, pension funds and endowment funds are requesting that their asset managers take ESG factors into account during the investment process.

A worker wearing a protective mask attends to basil plants at the ComCrop rooftop farm in Singapore, on Wednesday, May 27, 2020.

Lauryn Ishak | Bloomberg | Getty Images

Wu said Japan’s Government Pension Investment Fund integrated sustainability and ethical practices in 2017, and that sent a “ripple effect” through the industry.

“We think that’s going to continue for the rest of the region,” she said.

Sustainability trends

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