IN BRIEF

In the wake of the economic volatility created by the COVID-19 pandemic, it is clear that environmental, social and governance (ESG) issues are material factors that businesses must manage appropriately. From immediate relief efforts to long-term recovery strategies, sustainable finance is a key part of the solution.

KEY STATISTICS

• The International Monetary Fund (IMF) forecasts that global GDP is set to decline by over 3 per cent this year, causing significant impacts on developing countries in particular.
• Sustainable investments have performed better in the downturn. An analysis by Morningstar showed that 24 out of 26 ESG index funds yielded higher returns than their non-ESG benchmarks in Q1 2020.
• The sustainable index funds focused on emerging markets performed even better. All three emerging-markets sustainable index funds in the study were able to outperform their benchmarks.
• A study by HSBC shows that companies that prioritize ESG and climate issues have seen their equities outperform their peers by up to 7 per cent since the beginning of the pandemic.
• Issuers have raised over US$ 100 billion in social and sustainable bonds in 2020, the majority of those to fund COVID-19 responses.
• The global market for responsible investment now stands at over $30 trillion.