logo
  • Products

    Investment Vehicles

    • ETFs
    • Commingled Funds
  • Investment Strategies

    Investment Options

    • Alternatives
    • Beta Strategies
    • Equities
    • Fixed Income
    • Global Liquidity
    • Multi-Asset Solutions
    • Commingled Funds

    Capabilities & Solutions

    • ETFs
    • Global Insurance Solutions
    • Liability-Driven Investing
    • Pension Strategy & Analytics
    • Outsourced CIO
    • Retirement Solutions
    • Sustainable Investing
  • Insights

    Market Insights

    • Market Insights Overview
    • Eye on the Market
    • Guide to the Markets
    • Guide to Alternatives
    • Market Updates

    Portfolio Insights

    • Portfolio Insights Overview
    • Alternatives
    • Asset Class Views
    • Currency
    • Equity
    • Fixed Income
    • Long-Term Capital Market Assumptions
    • Portfolio Strategy
    • Sustainable Investing Insights
    • Strategic Investment Advisory Group

    Retirement Insights

    • Retirement Insights Overview
    • Guide to Retirement
    • Defined Contribution
  • Resources
    • Center for Investment Excellence Podcasts
    • Events & Webcasts
    • Insights App
    • Library
    • Taft-Hartley
    • market volatility
    • Morgan Institutional
  • About Us
    • Trusted Asset Manager
    • Diversity, Equity & Inclusion
    • Sustainable Investing
  • Contact us
Skip to main content
  • English
  • Role
  • Country
  • Morgan Institutional
    Search
    Search
    Menu
    You are about to leave the site Close
    J.P. Morgan Asset Management’s website and/or mobile terms, privacy and security policies don't apply to the site or app you're about to visit. Please review its terms, privacy and security policies to see how they apply to you. J.P. Morgan Asset Management isn’t responsible for (and doesn't provide) any products, services or content at this third-party site or app, except for products and services that explicitly carry the J.P. Morgan Asset Management name.
    CONTINUE Go Back
    1. What are the driving forces behind ESG investing?

    • LinkedIn Facebook

    What are the driving forces behind ESG investing?

    09/17/2021

    Meera Pandit

    Although ESG is still in its early innings, long term investors willing to be patient as it continues to evolve may benefit as the opportunity set grows and changes.

    Meera Pandit

    Meera Pandit

    Global Market Strategist

    Listen to On the Minds of Investors

    09/17/2021

    Sustainable investing, which considers environmental, social, and governance factors (ESG), is a philosophy most investors are aware of, but not all may fully understand it, as it has evolved meaningfully over the past few years. There are a number of catalysts driving momentum into sustainable investing, notably these 7 Essentials of ESG:

    1. ESG considerations are affecting consumer preferences and public attitudes – Many consumers are demanding more sustainable products, and are willing to pay up for them. There is considerable growth in sustainable consumer packaged goods, alternative meat and plant-based foods, and eco-friendly fashion. Companies are responding to these preferences by altering what the sell and how it is produced and distributed.
    2. Policymakers are setting environmental and social goals. Policymakers around the world have committed to net zero carbon emissions to mitigate global warming. Social goals are gaining momentum as well, with the Federal Reserve explicitly noting greater inclusion as part of its full employment mandate.
    3. For some companies this may be a headwind… For industries reliant on fossil fuels, this could be a challenge for those that do not adapt, particularly with the renewable energy becoming more affordable. 
    4. …but it also creates significant opportunities for those at the forefront of change. Not only does green energy stand to benefit, but so does the ecosystem around it like storage, transportation, and electrification. Other innovations like electric vehicles have been growing at impressive rates, although are still in the nascent stages of traction. 
    5. It’s not just climate, G matters and focus on S is growing. Proper governance can mitigate the risk of poor management, fraud, or negligence that can negatively impact future profits. Separately, 2020 revealed both social inequality and deep disparities in health outcomes; policymakers and companies are focused on tackling longstanding inequality. 
    6. ESG is affecting the investment landscape… As with any investment strategy, manager selection matters. There is still not a great deal of consistency around evaluating ESG factors, so skilled managers may have an advantage in unearthing opportunities. 
    7. ...and is changing the nature of investment flows – Assets under management, net flows, and product launches of sustainable strategies have increased, highlighting growing interest in the space.

     

    Although ESG is still in its early innings, long term investors willing to be patient as it continues to evolve may benefit as the opportunity set grows and changes.

    Sustainable mutual fund and ETF AUM

    Billions ($)



    Sustainable mutual fund and ETF AUM

    Source: Morningstar Direct, J.P. Morgan Asset Management. Includes open-ended funds and ETFs globally. To identify sustainable funds, we searched Morningstar Direct, as follows: 1. Open-End Funds and ETFs universe 2. Domicile = All Countries. 3. Sustainable Investment Overall = Yes. 4. Oldest share class = Yes. Data as of June 30, 2021.

    09n8211409205414

    EXPLORE MORE

    On the Minds of Investors

    What investment questions are on the minds of investors? Explore the questions investors ask frequently and find answers at J.P. Morgan Asset Management.

    Read more

    Guide to the Markets

    The J.P. Morgan Guide to the Markets illustrates a comprehensive array of market and economic histories, trends and statistics through clear charts and graphs.

    Read more

    Asset Class Views

    Get quarterly commentary and in-depth analysis on equities, fixed income and other asset classes, written by our senior investment teams.

    Read more
    • Environmental Social And Governance
    J.P. Morgan Asset Management

    • About us
    • Investment stewardship
    • Privacy policy
    • Cookie policy
    • Binding corporate rules
    • Sitemap
    • Accessibility
    Opens LinkedIn site in new window
    J.P. Morgan

    • J.P. Morgan
    • JPMorgan Chase
    • Chase

    READ IMPORTANT LEGAL INFORMATION. CLICK HERE >

    The value of investments may go down as well as up and investors may not get back the full amount invested.

    Copyright 2022 JPMorgan Chase & Co. All rights reserved.