Finance pros bet ESG will become mainstream

Mar 23, 2023 View in browser   By Allison Prang THE BIG PICTURE More than 60% of financial professionals surveyed expect ESG to become mainstream within the next 10 years. | HSBC ESG Sentiment Survey ESG could very well be here to stay, if the views of financial services professionals are any gauge. More than 60 percent of respondents to HSBC's latest ESG Sentiment Survey say they believe that it will become mainstream within the next decade, while 21 percent don't think it will become mainstream at all. Those results are likely to disappoint Republican politicians and red-state officials who have been attacking financial firms over their ESG policies. Texas, West Virginia and other states have divested public money from BlackRock and other asset managers that they accuse of boycotting fossil fuels and kowtowing to progressives’ agenda. The survey, the fourth HSBC has conducted, drew on responses from 422 financial-services industry professionals representing $11.5 trillion assets under management. Almost half of the respondents have signed onto or intend to sign onto the Principles for Responsible Investment, and nearly half said their ESG frameworks are a work in progress; about three-fifths have put those frameworks in writing. The majority of those surveyed aren’t interested in carbon credits. Only 3 percent of respondents were happily invested in them, and 11% were invested but worried about their integrity. Meanwhile, 52% of those surveyed weren’t interested in the credits at all. The quality of various carbon offsets has come under fire in recent years. “In general, voluntary carbon markets have grown over the past year given more companies have set net zero or similar climate targets,” the authors wrote. “However, scrutiny into the integrity of credits and offsets has also grown, leading to wide divisions in the approach to carbon markets.” Sustainability has also become more of a topic of concern among regulators, according to the survey’s results. Compared with a year ago, a higher percentage of financial professionals surveyed, or 33%, say that sustainability initiatives are required by their regulators. That rose from 22% a year prior. More financial services professionals say sustainability initiatives are being required by regulators. | HSBC ESG Sentiment Survey The survey report authors also noted that climate change is dominating ESG themes. “We are beginning to sense that climate is potentially taking focus away from other themes as it features so heavily in disclosures and national strategies,” the authors wrote. But they added that themes related to water and pollution are also worth watching.   DOWNLOAD THE POLITICO MOBILE APP: Stay up to speed with the newly updated POLITICO mobile app, featuring timely political news, insights and analysis from the best journalists in the business. The sleek and navigable design offers a convenient way to access POLITICO's scoops and groundbreaking reporting. Don’t miss out on the app you can rely on for the news you need, reimagined. DOWNLOAD FOR iOS– DOWNLOAD FOR ANDROID.     YOU TELL US GAME ON — Welcome to the Long Game, where we tell you about thelatest on efforts to shape our future. We deliver data-driven storytelling, compelling interviews with industry and political leaders, and news Tuesday through Friday to keep you in the loop on sustainability. Team Sustainability is editor Greg Mott, deputy editor Debra Kahn and reporters Jordan Wolman and Allison Prang. Reach us all at gmott@politico.com, dkahn@politico.com, jwolman@politico.com and aprang@politico.com. Want more? Don’t we all. Sign up for the Long Game. Four days a week and still free! WHAT WE'RE CLICKING — The financial industry isn’t walking away from ESG, but companies are changing how they talk about it, Bloomberg reports. — Intel and other chipmakers have allied with industrial materials companies to fight against rules banning “forever chemicals,” according to the Financial Times. — Bitcoin mining is booming in Texas, despite concerns over the industry’s electric power consumption. Reuters has that story.   LISTEN TO POLITICO'S ENERGY PODCAST: Check out our daily five-minute brief on the latest energy and environmental politics and policy news. Don't miss out on the must-know stories, candid insights, and analysis from POLITICO's energy team. Listen today.       Follow us on Twitter Debra Kahn @debra_kahn Greg Mott @gwmott Jordan Wolman @jordanwolman Allison Prang @AllisonPrang   Follow us

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