Sustainable development has become a major topic in the current context, and social and environmental challenges are of great concern on a global scale. Responsible and sustainable investing is part of this trend and aims to generate financial returns by considering environmental, social and governance (ESG) criteria.
This investment approach integrates environmental, social and corporate governance (ESG) criteria into the asset research and selection process. This process can start from a simple desire to reduce the risks linked to these factors (e.g., analysis of corporate controversies and misconduct) to a more comprehensive “best-in-universe” approach, where only companies with the highest ESG scores are included in portfolios.
This is a paradigm shift from the traditional approach to investment, but specifically, how do these concepts fit into management? To bring more clarity to this issue, Juan Carlos Durán, private banking advisor for Spain at Banque de Luxembourg, analyzes the different approaches.
For more than 100 years, the Banque de Luxembourg’s teams of experts have been supporting their clients in their investment strategy: focusing on wealth protection and a regular return on their investments, while considering ESG criteria.