New tools for change.
Institutional investors are increasingly aware of environmental, social and governance (ESG) factors. But quantifying the benefits remains a challenge.
'Sustainable investing' has come a long way. Many asset managers now include material sustainability criteria in their investment decisions. Recent figures show that sustainable investments are the 'new normal' with more than one quarter of assets under management globally now being invested sustainably.
ESG investing is no longer just a way to meet corporate social responsibility aims (often by making a trade-off between impact and profits). Integrating ESG principles can deliver value by identifying hidden risks and opportunities through the analysis of ESG information and trends.
We see the delivery of the UN’s Sustainable Development Goals (SDGs) as a particular area of opportunity: it is estimated that $90tn worth of investment is needed by 2030 to achieve these and the goals of the Paris climate agreement. The vast majority of these will require project finance capabilities to deliver the energy, transport and IT infrastructure needed to provide a sustainable future.
Freshfields has created and implemented complex, highly structured solutions for organisations across the public and private sector, working with the world’s leading national and multinational corporations, financial institutions, export credit agencies and governments on business-critical mandates, as shown below.
A Legal Framework for Impact explores whether and how legal frameworks allow for – and incentivise – investors to consider sustainability impact across major markets.
This work builds upon our 2005 publication (PDF) for the UNEP FI on the first legal framework for integration of environmental, social and governance issues into institutional investment.
We helped guide the legislation emanating from the EU Commission's sustainable finance action plan through the EU legislative procedure (in particular the EU disclosure regulation and the taxonomy proposal).
Our efforts included helping the UN PRI’s dialogue with members of the European Parliament, the Council of Ministers and other stakeholders, and ongoing political analysis and advice on amendments to the Commission’s proposals by Brussels lawmakers and how to effectively influence these.
We also helped the UN PRI organise a high-level conference at our Brussels office, with participation of the Commission itself, to discuss the expectations for and benefits of the action plan.
This standard will help social impact investors understand the quantitative (not qualitative) social impact return valuation methodologies used by asset managers and academia. We are collaborating with academic institutions, as well as talking directly to asset managers at social impact investment funds about the methodologies they use.