WHAT TO INVEST IN - AND WHY?

Do ESG Funds Fulfil Their Promises?

With so many ESG funds to choose from, it has never been more important to do one’s homework as an investor.

The vast majority of asset managers who aim to comply with and improve environmental, social and governance (ESG) standards go to great lengths to ensure that the companies they invest in live up to their promises.

According to Greenpeace, corporations are ‘falling all over themselves to demonstrate that they are environmentally conscious’. The group says: ‘The average citizen is finding it more and more difficult to tell the difference between those companies genuinely dedicated to making a difference and those that are using a green curtain to conceal dark motives’.

Investors who want to put their money where their morals are face the same problem. The question is, how can investors find their way among this plethora of products offering different ‘shades of green’?

Separating the wheat from the chaff

Anyone thinking about allocating money to ESG funds needs to do two things above all. First, read the prospectus to understand the fund’s risks, fees and objectives. It’s about going through the information carefully, digesting it and highlighting the parts that are confusing or difficult to understand. The second step is getting in touch with the fund provider.

We try to be as transparent as possible about the offering we have by explaining what it is we’re targeting

ISABELLE VIC-PHILIPPE,
Head of Euro Aggregate Fund Managment at Amundi

Isabelle Vic-Philippe, Head of Euro Aggregate fund management at Amundi, says that transparency on the part of the fund provider is key. ‘At Amundi, we try to be as transparent as possible about the offering we have by explaining what it is we’re targeting. Take our range of thematic ESG funds as an example: they focus on a specific objective and are therefore suitable for individual investors who have a specific concern in mind.’

Investors are careful to ensure their savings are used for the purposes they want them to be used for. Amundi stands wholeheartedly behind this principle and strives to give the best possible experience to investors who entrust the company with their money. 

To do so, the European leader relies on in-house research capabilities, based on information from different ESG data providers and in dialogue with companies, to provide a deep understanding of a company’s ESG capabilities and strategy.

Proprietary research is vital when it comes to responsible investing; it’s not enough to rely on the pre-chewed information from data providers. Amundi’s ESG analysts apply a methodology based on 37 criteria to analyse companies on E, S and G issues, with regard to international norms and sustainable development challenges. Additionally, Amundi is in a constant dialogue with the companies it invests in to add to an additional layer of oversight.

IMPORTANT INFORMATION

Unless otherwise stated, all information contained in this document is from Amundi Asset Management S.A.S. and is as of 1 December 2020. Diversification does not guarantee a profit or protect against a loss. The views expressed regarding market and economic trends are those of the author and not necessarily Amundi Asset Management S.A.S. and are subject to change at any time based on market and other conditions, and there can be no assurance that countries, markets or sectors will perform as expected. These views should not be relied upon as investment advice, a security recommendation, or as an indication of trading for any Amundi product. This material does not constitute an offer or solicitation to buy or sell any security, fund units or services. Investment involves risks, including market, political, liquidity and currency risks. Past performance is not a guarantee or indicative of future results. All investors should seek professional advice prior to any investment decision, in order to determine the risks associated with the investment and its suitability.

Date of first use: 31 January 2021

Doc ID# 1501793

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