Consider ESG risks upfront for better returns: Sera Global’s Martha Tredgett
The war in Ukraine is forcing investors, especially those who prioritize environmental, social and governance (ESG) factors, to take a closer look at the stocks and other assets they hold, whether individually or through funds.
Christie Stephenson, executive director of the Peter P. Dhillon Centre for Business Ethics at the UBC Sauder School of Business, says that this is an ESG investing case study happening in real time.
As a result, portfolio managers are now fielding questions from investors about direct and indirect exposure to Russia, and which sectors might be better choices at this time.
They say they're adjusting recommendations to better fit the situation and thinking more about what makes a good ESG investment.
Stephenson believes the reaction to geopolitical tension in eastern Europe is evidence that money managers need to pay more attention to issues around injustice and the regional social and political climate when deciding what assets to hold.
Over the last few weeks, many asset managers and pension funds have pledged to divest their Russian holdings because of the humanitarian crisis happening in Ukraine, including several in Canada.