Shane Meredith: ESG Investing Gains Credibility in Asia
Shane Meredith just joined SuisseTechPartners as Head of Sales APAC. In this article he shares his insights on ESG investments in the Asia-Pacific region.
Money managers have another reason for promoting Environmental, Sustainable, and Governance (ESG) investing. Asia-Pacific governments are promoting ESG investments.
The People’s Bank of China (PBOC) issues a list of green bond products, for example. Similarly, the Monetary Authority of Singapore (MAS) has issued guidelines on environmental risk management for asset managers.
The primary focus of official ESG is to promote green energy and other environmentally-friendly investments. The PBOC promotes green energy to reduce greenhouse gases and combat global warming, for instance.
There is opportunity for ESG growth in Asia because most Asia-Pacific countries lag behind other regions in sustainable investment. The Financial Times estimates 30% of investments in the US and Canada are in ESG instruments. In contrast, only 5% of East-Asia investments are in ESG. Thus, Demand, for ESG investments in Asia will grow.*
"Smart money managers could reduce clients’ tax burdens by investing in ESG instruments.”
The PBOC list and the MAS guidelines are valuable tools for money managers who want official ESG products. An obvious reason for money managers to such guidelines is to locate ESG products that meet requirements for tax credits.
Smart money managers could reduce clients’ tax burdens by investing in ESG instruments. All money managers need to study official ESG guidelines carefully because governments throughout the Asia-Pacific region will promote these products.