Environmental, social, and governance (ESG) factors are gaining in prominence and consideration among mainstream investors globally. ESG data spans a range of issues, including measures of company carbon emissions, labour and human rights policies, and corporate governance structures. Policy makers, asset owners, and the public at large are focused on ESG factors as a means to promote sustainable business practices and products.
Investment professionals increasingly see its potential links to company operational strength, efficiency, and management of long-term financial risks. This ViewPoint sets out BlackRock’s views on ESG issues from the perspective of a fiduciary investor acting on behalf of asset owners, in this particular instance focusing specifically on corporate equities and debt.
- We define three areas in which investment managers integrate ESG factors, and our views on how ESG factors contribute to long-term value.
- We move to describe the current landscape of ESG disclosure initiatives across organisations and regulatory bodies.
- As a result of the challenges associated with assembling and evaluating ESG information, we conclude with our recommendations for policy makers to promote the standardisation of ESG metrics and disclosure requirements.