It didn’t take a pandemic for interest in environmental, social, governance (ESG) investing to increase. From 2016 to 2018, sustainable investing already had grown by more than 38 percent, according to US SIF. But during the recent economic downturn caused by the coronavirus pandemic, it did not pass unnoticed that funds that invested in companies based on their ESG ratings became “relative safe havens,” as S&P Global Market Intelligence put it, and BlackRock noted, “Overall, this period of market turbulence and economic uncertainty has further reinforced our conviction that ESG characteristics indicate resilience during market downturns.”

Read also Denmark’s MP Pension divests 24 oil company holdings

Matt Seymour, CEO of RiskFirst, discussed some of the recent trends in the pensions industry around ESG, as well as misconceptions that are still circulating. RiskFirst provides risk management analytics and reporting solutions for the pension and investment industry.

Read also Nigeria. NSE promotes Digitisation of Governance, Risk Management & Compliance with launch of SentryGRC

BenefitsPRO: What trends are you seeing around pension plans and fund managers looking at incorporating ESG factors into their investment strategy? What is their motivation?

Matt Seymour: Investors, particularly the growing generation of younger investors with increasing decision-making powers, are demanding more responsible and impactful investments. Asset owners are increasingly examining investments and wanting more in the way of reporting and meaningfully directing capital to impactful investments, rather than eliminating sectors in broad strokes.

In the US, there has also been an uptick in public perception of certain kinds of investments. Particularly given the increased scrutiny on issues like climate change and data privacy, individual companies are being held to a higher standard than ever before, and that is now affecting how investors choose where to allocate their money.

Read more @Benefits Pro