EU Proposed ESG Regulatory Framework

According to the Global Sustainable Investment Alliance Review [GSIR] for 2018, there was an estimated $31trn of assets invested in categorisations listed as Environmental, Social & Governance strategies – collectively known as the ESG acronym, or ’sustainability’ investment put more simply. Growth in these sectors globally since the inaugural GSIR survey was published for 2012 data has been both strong and sustained.

The purpose of this Spotlight – one of a number planned in the area of sustainability investing – is to examine the proposed regulatory changes currently being scrutinised by the European Parliament, and to consider the possible implications for the ESG sector. The GSIR notes in Europe: “From 2016 to 2018 sustainable investing assets grew at a modest pace, but not as quickly as the overall universe of assets professionally managed in Europe”. Alone among the five regional markets surveyed, the share of sustainable assets in Europe as a proportion of total assets invested declined.