June 2018: Evaluating ESG strategies

June marks the anniversary of President Donald Trump’s decision to withdraw the US from the 2015 Paris climate agreement. Perhaps paradoxically, the US retreat has provided impetus for others to advance the climate change agenda. Emmanuel Macron has stood out among world leaders in this respect since being elected to the French presidency a year ago. His answer to Trump’s ‘make America great again’ motto is to ‘make our planet great again’.

Rhetoric has been matched with action, not only by politicians but also investors. The value of green bonds issued grew over the past year to $155.5bn, the highest level of annual issuance on record. While this is still a small fraction of the overall fixed income market, green bonds are gaining prominence in investors’ portfolios. In March, Amundi and the International Finance Corporation closed the largest green bond ever raised, at $1.4bn. Public investors – central banks, sovereign funds and public pension funds – are also playing an increasingly important role in this market’s development, as explored in detail in OMFIF’s latest Global Public Investor report, launched in London last month.

We continue to ensure that our research into public investors’ environmental, social and governance strategies sparks debate and informs policy. Next month OMFIF will be hosting the second annual Global Public Investor Green Finance Symposium, in association with the Bank for International Settlements, Monetary Authority of Singapore and IFC. There is still a long way to go to a fully developed market for green investments. Our second ESG podcast series explores the obstacles to advancement and focuses on what is needed to move the agenda forward. As Macron told the US Congress during his visit to Washington in April, ‘There is no planet B.’
Key contributors include:

  • Maria Tapia, lead climate change specialist at the Inter-American Development Bank;
  • Louise Dudley, global equities portfolio manager at Hermes Investment Management;
  • Jean Boissinot, director of financial stability at the French Treasury;
  • Otaviano Canuto, executive director of the World Bank.

Click here to download.

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