Why ESG investing is more relevant than ever before - Octopus

Technology increasingly impacts every aspect of our lives. This resonates now more than ever, as over the last few weeks our new ways of working and living require us to rely heavily on technology.

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Computers, tablets, phones and conference call platforms are now used almost constantly for both work and entertainment in our homes. And the rate at which we consume information also seems to be at a peak, although this has been on the rise for some time. The internet has given us a voice and a platform to engage with billions of people at a click of a button. The result? A more informed and engaged population, including on the world’s most pressing environmental, social and governance issues, which have had a drastic impact on our lives.

The rise of ESG is not news for institutional investors, but the current global economic and social climate is likely to bring this issue into even sharper focus. Institutional investors are under growing scrutiny and pressure to deliver more than simply ‘good returns’. They must also demonstrate a willingness to engage with the ESG related issues and make an impact with their investments. If not, they risk being held to account by regulators and beneficiaries alike. UK Pension Minister Guy Opperman believes trustees need to think about beneficiaries’ long-term interests “by driving new investment in important sectors of the economy – helping to deliver sustainable environments, jobs and communities”. Beyond the current pandemic, healthcare real estate and renewable energy asset classes may become more relevant than ever. Climate risk will continue to be one of the most pressing issues facing the planet, now with the proof point that a country can quickly adapt to mass change where required. Meanwhile the pandemic has highlighted decades of underinvestment in the healthcare industry.

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