Patrick Yu, GM, SVP and Senior Partner, FleishmanHillard Hong Kong
The global landscape for environmental, social and governance (ESG) reporting is in the midst of rapid transformation, driven by new standards and evolving regulations while pressed by broad-based demand for greater transparency and accountability, and all set against a backdrop of a growing number of investment decisions being shaped by ESG considerations.
Investors of all stripes (institutional, pension, private equity etc.) plus other stakeholders want clarity and consistency in the ESG audit process so they can make the correct investment decisions. Many already undergo due diligence on ESG credentials before putting money into funds, M&As or other company financings, but they want to use standardized measures as a foundation.
In our new report, The New World of ESG Compliance and Communications in Asia Pacific, we look at the new standards benchmarks for ESG Reporting from the International Sustainability Standards Board (ISSB). We also take a look at the readiness of companies and different jurisdictions to adopt them.
The stakes are high. Bloomberg Intelligence reports that ESG investable assets surpassed $35 trillion in 2020 and could reach $50 trillion by 2025 – that’s about one-third of projected assets under management globally. For fund managers and investors to be absolutely confident in the integrity of the ESG products they sell or buy is paramount.
In our Future of Asset Management in Asia report released earlier this year, we found that 80% of investors place a high value on strong ESG product offerings, especially those in mainland China (90%) and Hong Kong (80%).
