Brian Deese, Global Head of Sustainable Investing

BlackRock Bottom Line: Sustainability in 2020

It's a great question and it's a place we always need to start. We start with a simple definition:

Sustainable investing combines the best of traditional investing approaches with insights about society, traditionally non-financial insights, to generate better long-term outcomes for our clients.

First, this is about delivering on our fiduciary obligation. This is about finding ways to integrate sustainability consistent with driving long-term financial performance. The second is, this is about enhancing the way we invest. Improving on traditional investing approaches by taking new approaches, new data, new insights. It drives you toward an understanding of how can you actually measure and integrate those sustainability-related issues.

In 2020, we see two principal limits. The first is the physical limits associated with climate change and as we see, increasingly see the impacts of rising global temperatures, we will reach physical limits. And the second is the societal expectations and frustrations around sustainability-related issues. This is going to force limits on how companies are allowed to operate, when companies lose their social license to operate.

The bottom line for sustainability in 2020 is increasingly issues that have been considered nonfinancial are going to come to the core of financial analysis. And the bottom line for investors in 2020: You need to be thinking more about sustainability, asking more questions about the risks that sustainability may pose to your financial investments. But also more opportunities for you to invest consistent with your sustainability views and do so in a way that will be better for your long-term financial outcomes.