ThinkAdvisor, September 20, 2018:
“Roughly 25% of all investable assets globally, or more than $23 trillion, is invested in impact or environmental, social and governance products today. Most of this is invested on the equity side, as the fixed income ESG area is still nascent — for now.
In fact, according to Cornerstone Capital Group, only $385 billion has been allocated to fixed income ESG investing. Further, most “green bond” issuances fall into the $10 million to $100 million bracket. And there’s only a limited number of issuers of sustainable bonds. ESG equity funds, according to an MSCI analysis, outnumber ESG fixed income funds 3 to 1 globally and 4 to 1 in the United States.
That said, Cornerstone equity strategist Michael Geraghty believes fixed income ESG is an area advisors should counsel their clients on, especially those who want to spread impact investing throughout their portfolio.
‘This is a relatively new and unexplored area,” Geraghty told ThinkAdvisor. “Quite a bit has been written about how asset managers use ESG in fixed income portfolios, but very little has been written on how asset owners or clients can incorporate ESG into fixed income portfolios.’”
Read the full article here.