Growing the sustainable pie the right way

Key trends that will help to shape the growth of the sustainable fixed-income market in 2021 and beyond.

  • We anticipate an increased focus on management incentives being tied to ESG-related key performance
    indicators (KPIs), and not just at senior management level.
  • We believe 2021 will see the continued evolution of regulatory plans which will challenge investors,
    assets owners, companies and governments to improve their sustainable disclosure and reporting.
  • We predict the robust growth of corporate and sovereign green, social and sustainable bond issuance,
    both by region and sector. Credibility is key to its continued growth.
  • By asking more of issuers, ranging from the bare minimum of whether they have an ESG plan, to specific
    topics on how sustainability affects their businesses, fixed-income investors can push issuers to improve
    their practices, transparency and reporting for the benefit of all stakeholders.
  • In our view, shareholders and bondholders working together will create the maximum opportunity to
    improve environmental and societal outcomes, as well as share best practices.

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Newton Investment Management is a global investment management firm, providing, in partnership with its parent company BNY Mellon Investment Management, a focused range of investment strategies to public and private-sector superannuation funds, corporations, and individuals. We run a broad range of multi-asset, fixed-income and equity strategies, and have particular expertise in absolute-return, income-focused, high-conviction and sustainable investing. We use a global thematic approach to help achieve long-term perspective. Our themes inform both the rigorous fundamental analysis carried out by our experienced global research analysts, and the construction of portfolios designed to meet our clients’ requirements. In addition to financial measures, we evaluate factors such as environmental impacts, social standards, and the effectiveness of people in charge. We believe this ‘purposeful ownership’ approach allows us to better manage risk and make more informed investment decisions, helping investors worldwide meet their desired investment outcomes. www.newtonim.com/australia