Emerging Markets Offer Big Investment Opps for ESG-Focused Investors, Report Says - Environment + Energy Leader | Canada News Media
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Emerging Markets Offer Big Investment Opps for ESG-Focused Investors, Report Says – Environment + Energy Leader

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3 years ago

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A new report touting the importance of ESG factors and their impact on investments and investment decisions has found that better environmental stewardship can unlock significant value in private equity. Another key finding is that emerging markets offer some of the world’s most consequential investment opportunities for investors focused on mitigating global climate and social risks.

The semiannual Global Intelligence report from Manulife Investment Management highlights the fact that “sustainable investing is no longer an option. It is a necessity…,” says Christopher P. Donkey, CFA, global head of public markets at Manulife Investment Management.

Emerging Markets

When it comes to emerging markets (EMs), the report finds that emerging market companies currently rival their developed-market counterparts in terms of the sophistication of sustainability practice and growth potential.

The IEA stated in 2019 that, “There is a new reality in clean energy.” The world’s major emerging economies — including China, India, and several others — are moving to the center stage of the clean energy transition, it said, adding, “In fact, taken as a whole, Asia — which dominates the MSCI Emerging Markets Index — is the world’s largest investor in low-carbon energy sources.”

The significant stake in green energy capacity couldn’t have arrived too soon for emerging markets — or the world — as Asia is expected to drive more than two-thirds of new global energy demand over the next 20 years, per the report. However, the report prevaricates that, “…if we see a collective failure to coordinate climate policy, practice, and investment, then EM growth itself is more likely to precipitate a disappointing and painful future of ongoing structural dislocations.”

Businesses Must Heed the Call

Businesses that are inattentive to growing calls for responsible stewardship of environmental and social capital are likely to lose competitive advantages and find themselves spurned by consumers and investors alike, the report warns.

“Whether coming from customers, employees, suppliers, or communities more broadly, the call for sustainable practices has only increased since the start of the pandemic,” it says.

Consumers say their spending is migrating toward companies conducting operations sustainably, and investors have been taking notice. In fact, sustainability has become an imperative since so many investors now demand it. While they still require strong investment returns, sustainability has risen to a commensurate level for many investors.

The reasons aren’t purely altruistic, according to the report. In fact, 66% of limited partners say that value creation is a leading driver of their ESG initiatives (per PwC).

Three-quarters expect sustainability to influence their investment decisions over the next five years, according to Coller Capital; additionally, says Ceres, 86% expect ESG investment opportunities to increase, and 93% agree that focusing on ESG themes will generate attractive investment opportunities.

Another recent indication of how ESG investing is on the rise was the announcement earlier this week that more than 20 leading companies — including 3M, ADM, Apple, Bank of America, FedEx, General Motors, Honeywell, Nike, Smithfield Foods and TD Bank Group — have invested in TPG Rise Climate, the climate investing strategy of TPG’s global impact investing platform. TPG Rise Climate announced its first-close of $5.4 billion in subscriptions to its inaugural fund, Environment + Energy Leader reported.

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S&P/TSX composite up more than 100 points, U.S. stock markets mixed

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2 days ago

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October 16, 2024

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TORONTO – Canada’s main stock index was up more than 100 points in late-morning trading, helped by strength in base metal and utility stocks, while U.S. stock markets were mixed.

The S&P/TSX composite index was up 103.40 points at 24,542.48.

In New York, the Dow Jones industrial average was up 192.31 points at 42,932.73. The S&P 500 index was up 7.14 points at 5,822.40, while the Nasdaq composite was down 9.03 points at 18,306.56.

The Canadian dollar traded for 72.61 cents US compared with 72.44 cents US on Tuesday.

The November crude oil contract was down 71 cents at US$69.87 per barrel and the November natural gas contract was down eight cents at US$2.42 per mmBTU.

The December gold contract was up US$7.20 at US$2,686.10 an ounce and the December copper contract was up a penny at US$4.35 a pound.

This report by The Canadian Press was first published Oct. 16, 2024.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD)

The Canadian Press. All rights reserved.

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S&P/TSX up more than 200 points, U.S. markets also higher

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7 days ago

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October 11, 2024

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TORONTO – Canada’s main stock index was up more than 200 points in late-morning trading, while U.S. stock markets were also headed higher.

The S&P/TSX composite index was up 205.86 points at 24,508.12.

In New York, the Dow Jones industrial average was up 336.62 points at 42,790.74. The S&P 500 index was up 34.19 points at 5,814.24, while the Nasdaq composite was up 60.27 points at 18.342.32.

The Canadian dollar traded for 72.61 cents US compared with 72.71 cents US on Thursday.

The November crude oil contract was down 15 cents at US$75.70 per barrel and the November natural gas contract was down two cents at US$2.65 per mmBTU.

The December gold contract was down US$29.60 at US$2,668.90 an ounce and the December copper contract was up four cents at US$4.47 a pound.

This report by The Canadian Press was first published Oct. 11, 2024.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD)

The Canadian Press. All rights reserved.

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Economy

S&P/TSX composite little changed in late-morning trading, U.S. stock markets down

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1 week ago

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October 10, 2024

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TORONTO – Canada’s main stock index was little changed in late-morning trading as the financial sector fell, but energy and base metal stocks moved higher.

The S&P/TSX composite index was up 0.05 of a point at 24,224.95.

In New York, the Dow Jones industrial average was down 94.31 points at 42,417.69. The S&P 500 index was down 10.91 points at 5,781.13, while the Nasdaq composite was down 29.59 points at 18,262.03.

The Canadian dollar traded for 72.71 cents US compared with 73.05 cents US on Wednesday.

The November crude oil contract was up US$1.69 at US$74.93 per barrel and the November natural gas contract was up a penny at US$2.67 per mmBTU.

The December gold contract was up US$14.70 at US$2,640.70 an ounce and the December copper contract was up two cents at US$4.42 a pound.

This report by The Canadian Press was first published Oct. 10, 2024.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD)

The Canadian Press. All rights reserved.

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