ESG Alternatives - ‘This is the critical decade’
The alts investors putting ESG front and centre
According to Nathalie Wallace, chief sustainability officer at Edmond de Rothschild, there is growing recognition of climate and ESG risks within the investment community.
Large institutional investors, particularly pension funds and sovereign wealth funds, are increasingly prioritising the decarbonisation of their portfolios and seeking climate solutions across both equity and debt markets.
‘We are seeing this across the board,’ she said, noting that financial incentives for sustainable investments are becoming more apparent as regulatory frameworks mature and market expectations shift.
‘Compared to seven years ago, it’s really day and night in terms of what people are doing in ESG integration’
‘SFDR [Sustainable Financial Disclosure Regulation] has set the stage for greater transparency and accountability,’ Grijalva Ortega said. ‘It’s about walking the talk and providing investors with data that proves you’re doing what you said you were going to do.’
The integration of sustainability into private market strategies though is not merely a response to regulatory pressures but represents a fundamental shift in how investments are approached. The alts universe has also, however, become a breeding ground for collaboration, and novel ways of ‘greening the grey’ in ways that go beyond just the numerical investment of capital.
This nuanced approach to ESG is indicative of the industry’s growing sophistication, and the recognition that a one-size-fits-all solution is not the answer.
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