Sustainable Finance Flashcards
UBS how many will pay more for a sustainable product?
69%
Across the MDBs backed by all G7 countries, how much debt is outstanding.?
USD 400 billion
4 reasons why sustainable data is not high quality
- limited standardisation
- varying amounts of data disclosed
- inconsistent location (it is spread across multiple reports)
- limited assurance (some firms use partial data)
What were some of the main shifts in practice since mid-2010s?
Considerable resources and expertise
Attract larger pool of institutional capital
Objective decision-making encourages efficiency
In 2023, are fees from sustainable issuance
greater than fees from the fossil fuel
industry.
In 2023, for the second year in the row,
fees from sustainable issuance were
greater than fees from the fossil fuel
industry.
How much is invested in private markets today?
ca. USD 300-400bn
How many (%) private market firms integrate ESG into their analysis?
70%
What are challenges of multilateral development bank bond (MDB)?
lack of transparency
Conflicting sustainability priorities
corruption
What are the disadvantages when building a sustainable investing strategy in a smaller firm?
Smaller pool of assets
Limited media footprint
What are the most popular standards?
ISSB
GRI
CSRD
What do charities & foundation investors care a lot about in sustainable investing?
Reputation protection, manager integrity, mission alignment
How much in % of thematic fund assets are actively managed?
Roughly 75 %
How much (%) does the USA embrace sustainability?
45%
What key building blocks did the traditional portfolios lack?
single currency investment-grade funds
corporate emerging market bond funds
gold
What is the challenges for sustainability-linked bond?
Greenwashing risk + financial impact
How many (in%) investors are not in favor for a single standard?
34%
How many (%) private market firms employ at least one full-time person in the area of sustainability?
20%
How does an engagement process typically function?
- Engagement priorities are defined
- portfolios are scanned for relevant targets
- an engagement strategy will be defined
- tools to succeed
- final analysis
What are challenges for recycled gold?
Cost
Scale
Provenance
How much (%) does the EU embrace sustainability?
80
Do exclusions help people and planet?
The use of exclusions does not have a direct material positive impact on people and planet
What are challenges for use-of-proceed bond?
Greenwashing risk
Liquidity risk
Portfolio construction risk
2 Challenges when implementing exclusion?
- Data quality
- Differing values
Challenges to MSCI rating?
- difficult to compare different sectors
- big firms have consultants to increase their rating
Which 3 countries have the least developed regulatory ecosystem?
US, China and Turkey
Does engagement impact investment returns?
Does engagement impact investment returns?
There is some evidence engagement can increase investment returns.