All investors have responsibility to consider environmental, social and governance investments, says deVere CEO Nigel Green.
As Monday 3 July became the world’s hottest day on record, exceeding an average of 17 degrees Celsius for the first time, Green warned that temperature underscores the “lack of global progress” on tackling climate change.
Green says: “The new record high shines a spotlight on the extreme temperatures engulfing the northern hemisphere this summer. Monday 3 July 2023 must act as a wake-up call that more must urgently be done to battle the worst effect of human-driven environmental issues.
“As such, I believe that every investor now has a responsibility to consider ESG investments.”
Aside from the positive environmental and social impact of ESG investments, Green said strong returns are another reason investors should consider this asset class.
He explained: “Numerous studies have demonstrated that companies with strong ESG practices tend to outperform their peers over the long term. By incorporating ESG investments, investors have the opportunity to participate in the growth of companies that are well-positioned to navigate risks, capitalise on emerging opportunities, and drive sustainable innovation.”
Green said that by considering environmental risks, such as climate change and resource scarcity, social risks and governance risks such as board diversity and transparency, investors can better assess the long-term viability of investments and reduce exposure to potential risks.
He added: “The global regulatory landscape is evolving. Investors who proactively integrate ESG investments into their portfolios can navigate regulatory changes more effectively and position themselves for future market shifts.
“Plus, as ESG considerations become mainstream, investments in companies with strong ESG profiles are likely to attract more attention from institutional and individual investors. All of the reasons and all the evidence suggest that ESG-focused investors can achieve both profitability and positive impact.”
