What's New In Investments, Funds? - DBS, MSCI

Editorial Staff

7 January 2020

has said that it intends to embed ratings for environmental, social and governance measures of investment into its wealth management business, playing to a continued drive by firms to push their ESG credentials.

The Singapore-based banking group said that it is adopting MSCI ESG Ratings. The ratings score companies on their ESG risk exposure and risk management abilities relative to industry peers; they also cover equities, bonds and funds.

The ratings will be available to wealth management clients through their relationship managers on request. DBS will also explore leveraging this capability to introduce ESG offerings in retail applications, it said in a statement late last week.

Though relatively nascent in Asia, ESG investing is a growing trend. According to the CFA Institute, ESG assets under management in Asia have been the fastest-growing since 2014. A 2017 FactSet study found that 90 per cent of the high net worth Millennials surveyed want to increase their allocations to responsible investments within five years.

“Clients’ attitudes towards ESG investing are becoming increasingly favourable. Encouraged by growing evidence of the correlation between robust ESG practices and strong corporate financial performance, more are expressing interest in incorporating ESG into their decision-making processes,” Marc Lansonneur, head of managed solutions, balance sheet products and investment governance at DBS Wealth, said. “However, they are often hampered by the lack of historical ESG data or a recognised sustainability benchmark. By adopting MSCI ESG Ratings and enabling transparent comparability, we hope to address this gap and drive growth in the ESG investing space.”