According to RBC Global Asset Management, institutional investor respondents (both globally and US specifically) to its fourth annual survey: "Responsible Investing: An Evolving Landscape" ranked cybersecurity as the ESG issue they are most concerned about when investing, followed by anti-corruption and water, respectively. Trailing the pack of specifically enumerated issues of concern were board diversity, income inequality, and workplace diversity, as shown here:
Among the issues you would consider while investing, how concerned are you about the following...
Additional noteworthy results include:
- Board diversity - Most US investors (55%) are opposed to companies adopting board gender diversity targets. Globally, 52% of investors said "no" to such targets and 48% said "yes." Shareholder proposals are by far respondents' preferred approach (relative to regulators, market forces or other means) to encourage board gender diversity.
- ESG disclosure - The plurality of US investors are moderately satisfied with the current amount and quality of ESG-related disclosure provided by issuers. The majority (55%) of US investors say that shareholders - in lieu of e.g., regulators (13%), industry organizations (22%) or stock exchanges (2%) - should take the lead in influencing companies to provide better ESG-related information.
- ESG Performance - The percentage of respondents overall who believe an ESG-integrated portfolio will perform worse than a non-ESG integrated portfolio increased to 18% this year from 10% last year, and the percentage of respondents who said that integrating ESG factors can help mitigate risk declined to 58% from 67% year-over-year.
- Negative screening - On par with last year, more than three quarters of respondents (and 79% in the US) said they don't apply negative socially responsible investing screens to their portfolios. For those who do apply them, the application of fossil fuel-related screens by US investors declined 15% year-over-year in the context of a modest increase in the use of this screen at a global level.
The report on institutional investors' perceptions and intentions regarding responsible investing is based on a survey of nearly 800 institutional asset owners, investment consultants, and investment professionals in the US, Canada, Europe, and Asia.
See also RBC GAM's release and this Pensions&Investments article. This post first appeared in the weekly Society Alert!