Introduction of ESG Investment第一章

Climate changeResource depletionWastePollutionDeforestation

Environmental Factors——研究自然问题（与人无关）

Human rightsModern slaveryWorking conditionsChild laborEmployee relations

Social factos—研究大类人群问题

Bribery and corruptionExecutive payBoard diversity and structureTax strategy

Governance factors—研究具体人群问题

ESG Considerations non-financial:they are difficult to value precisely and difficult to time

定义

风险

机会

长期投资

Corporate social responsibility (CSR):is a broad business concept that describes a company'scommitment to conducting its business in an ethical way.—从道德出发，发展为商业模式中的战略角色

Tripple bottom line (TBL) as the three Ps:People---socialPlanet---environmental (biosphere)Profit---economic (financial)

外框

相关理论发展

1. Trading Practices—基于短期股价变动来做投资:based on short-term momentum and price movements 

2. Prioritizes maximizing quarterly financials—优先考虑季度财务数据less willing to take on projects such as research and development

Short-termism短视表现

Long-Termism长期主义

What is ESG Investing什么是ESG投资

1. Socially Responsible Investment (SRI) span style=\"font-weight:normal;\

All sector approach: 煤炭烟酒等行业可能被包含Not all best-in-class funds are considered to be 'responsible investments'

2. Best-in-Class Investment

3. Sustainable Investment

4. Thematic Investment

5. Geen Investment

只关注“S”这一个因素，有利于bottom of pyramid (BOP)Social investing can also include social impact bonds

6. Social Investment

7. Impact Investment

8. Ethical and Faith-based Investment

Scale of ownershipQuality of the engagementDivestment is a possible sanction

参与有效性的判断

9. Shareholder Engagement

Types of Responsible Investment责任投资类别

Impact and ethics perspective—投资者开始重视ESG

Client demand perspective—投资者偏好开始偏向ESG

For Asset Owner

公司内部角度：考虑ESG会使公司表现提升Engaging with companies on ESG issues can create value for bothinvestors and companies by encouraging better ESG risk managementand more sustainable business practices

Three reasons why the results differ:The alpha from ESG might be captured elsewhere in factors studiesThe impact of different approaches in the different studies might cancel each other outThe costs of implementation consume the available alpha

Financial performance

For Asset Manager

Risk perspective

Build efficiencies by:Conserving resourcesReducing costsEnhancing productivityAttract and retain quality employeesEmployee motivation and productivity提高能源利用率，减少成本提高生产力，留住好员工

Efficiency and productivity

政策改变会影响企业利润One-third of corporate profits are at risk

Reduced risk of fines and state intervention

外部性：externalities refers to situations where theproduction or consumption of goods and services creates costs or benefits to others that are not reflectedin the prices charged for them生产和消费过程中产生的没有体现在资产负债表上的影响，例如一次性餐盒对于外卖平台

Externalities can either be negative or positive

Reduced negative externalities

新兴市场城镇化-Emerging markets and urbanization

技术创新-Technological innovation

人口结构变化（老龄化）、财富不均衡-Demographic changes and wealth inequality

气候改变、资源短缺-Climate change and resource scarcity

实质/重大性的演变-Ecolution of Materiality

双重实质性/重要性—公司与气候之间相互影响-Double materiality: not just climate-related impacts on the companythat can be material but also impacts of a company on the climateDouble materiality is an extension of the accounting concept of financial materiality.

Benefit from sustainability megatrends

For Invested Company

监管：regulatory instrumentse.g. vehicle emission and safety standards

自愿：voluntary instrumentse.g. agreements with the car industry to reduce CO2 emissions

Internalization

甜甜圈经济学-Doughnut economicsThe Stockholm Resilience Centre has identified'nine planetary boundaries'

核心边界：气候变化，生物圈完整性Core boundaries: climate change andbiosphere integrity

Environmental issues:经济发展需要建立在可持续的基础之上negative megatrends will create drag on economic prosperity and may increase instabilityidentified climate change as a potential systemic risk

Economics perspective

For Macro Environment

Why Integrate ESG为什么整合ESG

认为ESG对投资结果有负面影响The perception that implementing ESG may have a negative impact on investment performance

传统的受托责任观念不考虑ESGFiduciary duty prevents investors from integrating ESG

没有足够的ESG产品提供选择The advice given by investment consultants and retail financial advisers often not been supportive of products that integrate ESG

Prior to implement ESG

不理解、不懂The lack of understanding of how to build an investment mandate that promotes ESG or lack of understanding of what the needsof asset owners regarding ESG

After deciding to implement ESG

Challenges In Integrating ESG整合ESG的挑战

Investor-led initiatives hope to address this problem:1. The International Corporate Governance Network (ICGN)established a Model Mandate Initiative2. The University of Cambridge Institute for Sustainability Leadershipspan style=\"font-size: inherit;\

不愿意做

不会做

Factors included:within investment mandateswithin the strategic asset allocation processby applying a filter based on ratingsby integrating ESG issues into financial modelsby using ESG factors to identify investment opportunities

For asset owners:Asset owners and asset managers can embed ESG into strategic asset allocation (SAA)

For direct investment:Asset managers and asset owners who invest directly can incorporate ESG issueswithin their security selection process

Investment Devision-Making投/不投？

Shareholder engagement:Investors can encourage investees to improve their ESG practices例如：参加AGM（in annual general meeting expressing their views through voting on resolutions）

Corporate Engagement

Investors can:respond to policy consultationsparticipate in collective initiativesmake recommendations to policymakers

Policy Engagement

Putting ESG Into Practice实践/落地

Human rights

Labour

Environment

Anti-corruption

United Nations Global Compact联合国全球契约组织 (UNGC)

mobilize private sector finance forsustainable development

United Nations Environment Programme Finance Initiative联合国环境规划署金融倡议 (UNEP FI)

Principles for Responsible Investment负责任投资原则 (PRI)

aims to stabilize GHG emissions tolimit man-made climate change

United Nations Framework Convention on Climate Change联合国气候变化框架公约 (UNFCCC)

17个目标

are the UN's blueprint to address the key global challenges

UN Sustainable Development Goals联合国可持续发展目标 (SDGs）

Race to Zero 零排放竞赛（净零）halve（减半） global GHG emissions by 2030

All members are in line with the Paris Agreement

Glosgow Financial Alliance for Net Zero格拉斯哥净零金融联盟 (GFANZ)

联合国相关措施

针对公司

针对金融机构

针对主权国家

Value Reporting Foundation（VRF-会计角度）:to provide investors and corporates with a comprehensivecorporate reporting framework

International Business Council ESG Disclosure Framework :aims to bring greater consistency and comparability to sustainabilityreporting by establishing common metrics for company disclosure

Corporate Sustainability Reporting Directive (CSRD)

Reporting Initiatives:ESG-Related Initiatives综合披露问题

Task Force on Climate-related Financial Disclosures (TCFD)

Former Carbon Disclosure Project (CDP)

Climate Disclosures Standards Board (CDSB)

专题披露问题

Asia Investor Group on Climate Change (AIGCC)

The EU'S Sustainable Finance Disclosure Regulation (SFDR)

促进全球合作/地域和国家的深度报告

Global Sustainable Investment Alliance (GSIA)

地区

公司治理方面

The International Corporate Governance Network (ICGN)

降低影响力投资的障碍（数据库）

Global Impact Investing Network (GIIN)

专题

其他举措

披露相关措施

Key Initiatives关键举措

Asset Allocation-资产配置

Manager Selection-选择管理人

Portfolio Construction-投资组合构建

Investment Process

Invested Company A(Investee-被投资方)

Invested Company B

……

Asset Manager A

Asset Manager B

Stock（股票）

Invested Company A

Bond（债券）

Asset Owner资产所有者

Macro Environment

投资流程框架

Introduction to ESG Investing

财务指标—传统投资考虑

非财务指标：Difficult to value preciselyDifficult to time

责任投资