APAC-based asset owners are unified in materiality of ESG as Australia grapples with greenwashing concerns, according to Morningstar’s survey of 500 global asset owners.
The research found that 91 per cent of APAC-based asset owners surveyed consider ESG factors material to total portfolio investment choices.
The global quantitative study included asset owners from 11 countries, representing approximately US$32.7 trillion ($48.5 trillion) in assets under management.
- Most survey respondents (85 per cent) believe ESG factors are material to investment policy. Many of them (70 per cent) feel ESG factors have become more material in the past five years;
- Overall, over 50 per cent of Australian asset owners believe that greenwashing is a moderate problem, with 26 per cent citing it as a significant problem;
- Opinion was, however, divided about the best way to tackle greenwashing. The most popular response was stronger enforcement of current regulations (26 per cent compared to the global average of 18 per cent), followed by better data (23 per cent), and more transparency (18 per cent); and
- ESG ratings, data, and tools are improving but need to get better. APAC AOs asset owners still see plenty of room for improvement in ESG tools, with nearly half (49 per cent) saying they would benefit from more accuracy, 46 per cent from more timeliness, and 40 per cent from more objectivity of ESG data. Furthermore, developments in regulation, data, reporting, analytical tools, and investment processes appear to be interdependent, with each aspect shaping the others.
About the survey
The new multi-phase survey, conducted for Morningstar by Opinium in conjunction with Collie ESG, aimed to gather insight into the evolving role of asset owners. It also aimed to collect information about the growing influence of ESG factors and sustainable investment considerations on the global market ecosystem.
The first phase of the survey comprised live qualitative interviews with fourteen asset owners in North America and Europe. This laid the foundation for the second phase, which consisted of global quantitative research.