Mercer: A Mere 9% of Investment Strategies Achieve High ESG Ratings
22.05.12
1) A demonstration that ESG factors feature in investment teamsâ decision making processes and corporate culture
2) An effort made to build in some ESG factors into valuation metrics, using their own judgment about materiality and time frames
3) A long-term investment horizon and low portfolio turnover
4) Ownership policies and practices that include sufficient oversight, integration with investment decision-making and transparencyÂ
5) For alternative assets, evidence of pursuing best practices in transparency and evaluation, monitoring and improvement of ESG performance as relevant for portfolio companies and sectors
6) A demonstrated willingness to collaborate with other institutional investors to improve company, sector or market performance
7) A commitment to ESG integration at the organization-wide level
Andrew Kirton, Mercerâs Global Chief Investment Officer, added that he was not surprised to see a relatively low percentage of strategies achieve top ratings, as Mercer's approach "involves setting a high bar".Â
Source: aiCIO