Asian Investors Bullish on ESG Investing, Based on Poll at Sustainable Investing Forum in Bangkok

Thailand’s government pension fund (GPF) to integrate ESG into all domestic investments by March 2020

Bangkok, November 1, 2019 – Asian investors are bullish on ESG investing and plan to ramp up sustainable investments in the next 12 months, according to a poll conducted at the inaugural GPF-Bloomberg Sustainable Investing Forum held in Bangkok on October 30. Eighty-nine percent of 140+ investors, asset owners and asset managers from Thailand and the region believe that ESG-integrated portfolios are likely to perform as well or better than non ESG-integrated portfolios and 51% said they will increase their sustainable investments in the next 12 months. The top two ESG bets in the next 12 months are in investments related to climate change (61 percent) and diversity & inclusion (23 percent).

According to Dr Seree Nonthasoot, Board Member of the Government Pension Fund of Thailand (GPF) and Governor of the Stock Exchange of Thailand, GPF’s 1-billion baht ESG-focused portfolio recorded a ten-month return of 4.6 percent, surpassing the GPF main equity fund by 50 basis points. Dr Seree also shared that 32 major institutional investors in Thailand with over 11 trillion baht (US$1.8 trillion) in assets under management have signed the ESG collaborative engagement guidelines initiated by GPF in August this year.

He added, “While the benefits of ESG investing are clear, the execution varies by country and region. Understanding and applying international best practices will support our ESG journey and hence such forums with leading industry experts are beneficial. We look forward to forging strong alliances with partners like Bloomberg, to build a robust eco-system to benefit all stakeholders.”

GPF has been working closely with partners such as UNPRI and OECD to develop due diligence guidelines in their investment process and ESG integration framework. According to Mr Vitai Ratanakorn, Secretary-General of GPF, the pension fund will complete its ESG scoring tool by end-year, which will be used to evaluate investment opportunities in Thai equities and fixed income assets.

“By the first quarter of 2020, GPF targets to use an ESG lens for all of our investments in the Thai market across equity classes including real estate, private equity and infrastructure,” added Mr Vitai. “This means GPF will not invest in a company if we have material concerns on its ESG track record.”

Nitin Jaiswal, Bloomberg’s APAC Head of External Relations, said, “Asia is emerging as a region for sustainable investing, and that’s driving demand from asset owners and managers for more ESG data, tools and knowledge. Thailand is already Asia’s top exchange for sustainability reporting. As GPF, the Stock Exchange of Thailand and the Securities and Exchange Commission continue to work together, we believe Thailand can set a leading example in the region of how sustainable investing can be fostered through strong public-private collaboration.”

Investors were also polled on the ESG investing strategies they currently deploy. Screening emerged as the top ESG investment strategy (29%), followed closely by corporate engagement /shareholder action (22%) and ESG integration (21%).

The inaugural GPF-Bloomberg Sustainable Investing Forum convened global experts and market practitioners in sustainable investing to promote more sustainable investing in Asia-Pacific. Topics discussed included how ESG standards and regulations will work in the region, building ESG investing capabilities and best practices, and what the big ESG investing ideas are.