Asia’s Next Top Trend: Investing in the “E” in ESG

There’s a growing opportunity for ESG outperformance in Asia that you shouldn’t miss.

Climate change is a serious problem, but governments, organisations, and individuals are increasingly trying to mitigate and counter its effects. In 2018, three border collies were tasked to run through damaged Chilean forests with special backpacks that released native plant seeds to rebuild the forest. In Asia, we might not have tree-planting pups, but we do have green tools to combat climate change. For example, Korea and China are world leaders in electric vehicles and in the renewable energy sectors. These innovations will be necessary, especially since climate change is expected to hit Asia the hardest. The urgency of this issue suggests there’s going to be greater opportunities for ESG outperformance in Asia.

With Asia’s infrastructure needs estimated to exceed USD26 trillion by 2030, now’s the time for investors to participate in the region’s “green infrastructure” push. Looking at the various ESG investing opportunities, should we only cultivate our investments in sectors or companies that have high ESG ratings? Not necessarily!

Beyond good ESG ratings, we can also look at companies that are transitioning and have intentional strategies to become more sustainable. There are many ways of evaluating ESG risks and you can think of them as gardening tools for growing your ESG portfolio. With the right tools in place, you’ll be able to nurture a stronger garden instead of pruning all risks blindly. It’s also important to assess a company’s level of preparedness against risks. Won’t you be more assured of the safety of your garden if it has a fence around it to guard against pests?

With Asia’s unique mix of strong economic growth and policy support, coupled with rapid wealth accumulation and rising ESG investing opportunities, there is potential for ESG outperformance. For investors, this might be the time for them to sow their seeds early and wait for the harvest.

If you want to learn more about ESG investing, read our thought leadership article on Why Asia offers the opportunity for ESG outperformance.

How to invest in Eastspring's fund(s)

ARTICLE ASIA CLIMATE CHANGE ESG FIXED INCOME GREEN INFRASTRUCTURE LIGHTER READS
This document is produced by Eastspring Investments (Singapore) Limited and issued in:

Singapore by Eastspring Investments (Singapore) Limited (UEN: 199407631H)

Australia (for wholesale clients only) by Eastspring Investments (Singapore) Limited (UEN: 199407631H), which is incorporated in Singapore, is exempt from the requirement to hold an Australian financial services licence and is licensed and regulated by the Monetary Authority of Singapore under Singapore laws which differ from Australian laws

Hong Kong by Eastspring Investments (Hong Kong) Limited and has not been reviewed by the Securities and Futures Commission of Hong Kong.

Indonesia by PT Eastspring Investments Indonesia, an investment manager that is licensed, registered and supervised by the Indonesia Financial Services Authority (OJK).

Malaysia by Eastspring Investments Berhad (200001028634/ 531241-U) and Eastspring Al-Wara’ Investments Berhad (200901017585 / 860682-K).

Thailand by Eastspring Asset Management (Thailand) Co., Ltd.

United States of America (for institutional clients only) by Eastspring Investments (Singapore) Limited (UEN: 199407631H), which is incorporated in Singapore and is registered with the U.S Securities and Exchange Commission as a registered investment adviser.

European Economic Area (for professional clients only) and Switzerland (for qualified investors only) by Eastspring Investments (Luxembourg) S.A., 26, Boulevard Royal, 2449 Luxembourg, Grand-Duchy of Luxembourg, registered with the Registre de Commerce et des Sociétés (Luxembourg), Register No B 173737.

United Kingdom (for professional clients only) by Eastspring Investments (Luxembourg) S.A. - UK Branch, 10 Lower Thames Street, London EC3R 6AF.

Chile (for institutional clients only) by Eastspring Investments (Singapore) Limited (UEN: 199407631H), which is incorporated in Singapore and is licensed and regulated by the Monetary Authority of Singapore under Singapore laws which differ from Chilean laws.

The afore-mentioned entities are hereinafter collectively referred to as Eastspring Investments.

The views and opinions contained herein are those of the author, and may not necessarily represent views expressed or reflected in other Eastspring Investments’ communications. This document is solely for information purposes and does not have any regard to the specific investment objective, financial situation and/or particular needs of any specific persons who may receive this document. This document is not intended as an offer, a solicitation of offer or a recommendation, to deal in shares of securities or any financial instruments. It may not be published, circulated, reproduced or distributed without the prior written consent of Eastspring Investments. Reliance upon information in this document is at the sole discretion of the reader. Please carefully study the related information and/or consult your own professional adviser before investing.

Investment involves risks. Past performance of and the predictions, projections, or forecasts on the economy, securities markets or the economic trends of the markets are not necessarily indicative of the future or likely performance of Eastspring Investments or any of the funds managed by Eastspring Investments.

Information herein is believed to be reliable at time of publication. Data from third party sources may have been used in the preparation of this material and Eastspring Investments has not independently verified, validated or audited such data. Where lawfully permitted, Eastspring Investments does not warrant its completeness or accuracy and is not responsible for error of facts or opinion nor shall be liable for damages arising out of any person’s reliance upon this information. Any opinion or estimate contained in this document may subject to change without notice.

Eastspring Investments companies (excluding joint venture companies) are ultimately wholly owned/indirect subsidiaries of Prudential plc of the United Kingdom. Eastspring Investments companies (including joint venture companies) and Prudential plc are not affiliated in any manner with Prudential Financial, Inc., a company whose principal place of business is in the United States of America or with the Prudential Assurance Company Limited, a subsidiary of M&G plc (a company incorporated in the United Kingdom).