Integrating sustainability performance into investment strategies

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GRI-Sustainability-Reporting-Guidelines

BY MICHAEL YOW

AUGUST 19, 2015 – The number of investors who are integrating sustainability performance into their investment strategies and decision-making is on the rise.

The number of signatories to the United Nations-supported Principles for Responsible Investment, an international network of investors working together to put the six Principles for Responsible Investment into practice, rose from 100 in April 2006 to 1,380 in April 2015, representing US$59 trillion in assets under management.

This spectacular rise is in part due to higher societal expectations of systemically important financial institutions, a broadening awareness of sound risk management and mounting evidence that sustainability-focused investing not only is good for the planet but also leads to superior returns.

A recent study at the Harvard Business School found that firms with good performance on material sustainability issues significantly outperform firms with poor performance on these issues, suggesting that investments in sustainability issues are shareholder-value enhancing:

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