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  • Reports/Guides

    ESG integration in fundamental strategies

    When integrating ESG factors into investment analysis, they are examined alongside other valuation drivers. It has been more common to process ESG factors through qualitative analysis, but investors are increasingly also quantifying and integrating ESG factors into financial forecasting and company valuation models, in alignment with other financial factors.

  • Reports/Guides

    ESG integration in quantitative strategies

    ESG integration has historically only been associated with fundamental strategies, but this perception is slowly changing as several quant managers are now integrating ESG factors into their valuation models and investment decisions.

  • Reports/Guides

    The impact of ESG integration on the investment process

    Fully integrating ESG factors into a new or existing investment process takes time and often requires trial and error. Many variables are involved and approaches differ between organisation and even between teams.

  • Reports/Guides

    Monitoring managers' ESG integration

    To review investment performance and managers’ integration practices, asset owners: organise periodic monitoring meetings with investment managers; ask them to complete questionnaires/regularly report; and/or use methods such as peer analysis, internal scoring systems and portfolio analytic tools.

  • The ESG integration model

    ESG integration techniques for equity investing

    ESG factors can be integrated throughout a listed equity portfolio, right across the active-to-passive spectrum.

  • A practical guide to ESG integration for equity investing

    A practical guide to ESG integration for equity investing

    To guide investors – both asset owners and investment managers – who are implementing ESG integration techniques in their investment decisions and processes, this report is the most comprehensive description to date of what ESG-integrated analysis is, and how it works in practice.

  • Oddo extended balance sheet

    ESG integration in sell-side equities research

    Sell-side brokers integrate ESG information with traditional financial information – by leveraging their financial information systems, their access to company management, and the expertise of mainstream, sector-focused investment analysts – to improve research.

  • Reports/Guides

    ESG integration in passive and enhanced passive strategies

    Some investors believe that as a manager cannot make active investment decisions in passive strategies, ESG factors cannot be integrated in passive investments as this may cause performance to deviate from the benchmark’s. Passive strategies can incorporate ESG factors, however.

  • selection guide

    Considering ESG integration in manager selection

    Selecting an investment manager that can act in accordance with an asset owner’s investment preferences requires thorough due diligence of the manager’s investment approach and performance, investment process, stock selection and portfolio construction decisions.

  • Reports/Guides

    ESG integration in smart beta strategies

    In smart beta strategies, ESG factors and scores can be used as a weight in portfolio construction to create excess risk-adjusted returns, reduce downside risk and/or enhance portfolios’ ESG risk profile.

  • Reports/Guides

    Assessing external managers' approach to ESG integration

    To integrate ESG considerations into their externally managed assets, asset owners (or their investment consultants) will assess external managers’ integration practices.

  • Reports/Guides

    Considering ESG integration in manager appointment

    Once the most eligible asset manager is selected, asset owners can include ESG terms in the investment management agreement (IMA) to formalise their expectations.

  • Fixed income investor guide

    Fixed income investor guide


    The Fixed income investor guide summarises the unique characteristics of fixed income with its various subcategories of issuers and instruments. It helps to explain why fixed income investors should take a bottom-up approach to RI while borrowing from the experiences of other asset classes, such as listed equities.

  • Reports/Guides

    Integrating ESG factors into issuer analysis


    In fixed income, a key application for ESG information is to inform analysis of issuer creditworthiness. ESG issues, such as corruption or climate change, are potential risks to macro factors that may affect an issuer’s ability to repay its debt.

  • fixedincomeinvestor

    Integrating ESG factors into sovereign issuer analysis


    Based on discussions and presentations with the PRI fixed income sovereign working group, this report is a primer that provides an initial conceptual framework exploring ESG issues that might be material to sovereign bond risk assessments and pricing (2014).

  • External environmental costs for different sectors

    Integrating ESG factors into corporate issuer analysis


    Analyses of governance factors such as remuneration and financial auditing are common among bond investors, but few systematically integrate a wide range of ESG factors into credit analysis.

  • Reports/Guides

    Integrating ESG factors into financial issuer and ABS analysis


    In recent years, investors have become increasingly sensitive to the potential financial impacts of risk management failures, malpractice fines and banks’ ability to meet new regulatory standards.

  • Reports/Guides

    ESG screening in fixed income investing


    Fixed income investors apply ESG filters or screens to their investment universe to control which issuers or securities are considered for investment. This is an effective way of ensuring their investments are aligned with their (client’s) ethical motivations and reduces reputational risks.

  • Proportion of PRI signatories engaging with issuers on ESG management (2014)

    Engaging issuers on ESG issues


    Debt and equity holders both stand to benefit financially from successful engagements, as ESG-related risks are mitigated and opportunities maximised.

  • Growth of green bonds issuance 2007–2014

    Themed fixed income investing


    Investment products such as green bonds are seen by many as a way of addressing ESG risks such as climate change and water scarcity.