Sustainable Investment Report Q1 2021

Last year was a transformational year for sustainability and this looks set to continue in 2021.

After a bumper year for flows into sustainable funds in 2020 this trend has continued, as they experienced positive flows in the first two months of this year, according to estimates by JP Morgan based on Lipper data.

In its 2021 update, the World Economic Forum’s annual global risks report highlighted that four of the five most likely risks business leaders identified were environmental. We also expect climate change to take centre stage this year ahead of the delayed COP26, which is scheduled to take place at the beginning of November.

In this report we put the spotlight on environmental issues too, with a number of climate-related articles.

These include a Q&A with Andy Howard, Global Head of Sustainable Investment, on Schroders' founding membership of the Net Zero Asset Managers initiative and how FTSE 350 companies have responded to our Group Chief Executive Peter Harrison’s request to prepare and publish their plans for a decarbonisation of the global economy.

We also look at how the transition to a low-carbon economy is going to impact banks and autos. The former sector, banking, is highly exposed to fossil fuels, an industry facing significant financial, regulatory and reputational risks, while the latter requires a shift in business model towards technology solutions.

Our analysts have engaged with companies in both sectors to better understand their exposure to these risks and opportunities.

Beyond climate, our latest report looks into a number of other key sustainability issues globally.

Meanwhile, the 2020 voting season saw companies switch to virtual annual general meetings (AGMs). Daniel Veazey, Head of Corporate Governance, shares his thoughts on what the 2021 season has in store.
Spoiler alert: virtual AGMs will certainly continue to play a role!

Read the full report here.

Important Information:
This material has been issued by Schroder Investment Management Australia Limited (ABN 22 000 443 274, AFSL 226473) (Schroders) for information purposes only. It is intended solely for professional investors and financial advisers and is not suitable for distribution to retail clients. The views and opinions contained herein are those of the authors as at the date of publication and are subject to change due to market and other conditions. Such views and opinions may not necessarily represent those expressed or reflected in other Schroders communications, strategies or funds. The information contained is general information only and does not take into account your objectives, financial situation or needs. Schroders does not give any warranty as to the accuracy, reliability or completeness of information which is contained in this material. Except insofar as liability under any statute cannot be excluded, Schroders and its directors, employees, consultants or any company in the Schroders Group do not accept any liability (whether arising in contract, in tort or negligence or otherwise) for any error or omission in this material or for any resulting loss or damage (whether direct, indirect, consequential or otherwise) suffered by the recipient of this material or any other person. This material is not intended to provide, and should not be relied on for, accounting, legal or tax advice. Any references to securities, sectors, regions and/or countries are for illustrative purposes only. You should note that past performance is not a reliable indicator of future performance. Schroders may record and monitor telephone calls for security, training and compliance purposes.