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In The Money
Taking ESG factors into account in investment process helps cut risk
In this fortnightly series, we address readers’ queries on investing issues. This week, we look at the increased interest in sustainable investing or that acronym alphabet soup called ESG.
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One major philosophy behind environmental, social and governance investing is rooted in the broader role that investors have in society. The idea is that asset managers have an obligation to ensure that capital is directed in a responsible way to opportunities targeting an overall positive effect on society.
PHOTO: ISTOCKPHOTO
Christopher Wong
Q: I am looking at investment funds and find that most of them now mention an ESG focus. Can it help deliver better returns? Why is it so important and what choice do I have if I’m not keen on ESG?
Simply put, ESG investing is the consideration of environmental, social and governance factors alongside financial factors in the investment decision-making process.
