Private banks in Europe are starting to fill up their shelves with environmental, social and governance (ESG) products and this trend is slowly catching on in Asia.
Madeline Ho, managing director and head of wholesale fund distribution for Asia Pacific at Natixis Investment Managers Singapore, said ESG is an important theme going forward.
‘We’ve seen a trend in the last 18 months where a lot of the large global European private banks have started to fill the shelves with ESG products,’ she said.
‘If they have taken up one of our funds elsewhere, usually they sell it globally. So we need to make them available so they can sell it in Singapore and Hong Kong.’
Natixis IM currently has two ESG funds – Mirova funds – Mirova Global Green Bond fund and Mirova Funds – Mirova Global Sustainable Equity fund – available to investors in Singapore.
Incepted in February 2017, the Mirova Global Green Bond fund had $27.1 million in assets as of March 20. Mirova Global Green Bond fund is managed by Christopher Wigley and Marc Briand.
Meanwhile, Mirova Global Sustainable Equity fund was incepted in March 2016 and had $81.47 million in assets as of March 20. Mirova Global Sustainable Equity fund is managed by Jens Peers, Suzanne Senellart and Hua Cheng.
Although the trend of filling ESG products on private banks shelves is catching on, the take up rate of the ESG products is still quite small in Asia for now, however.
Ho said ESG investing is still nascent in Asia and there is much work to be done in terms of investor education.
‘There’s a lot of misconception that when you do good, you are not doing well,’ she said.
Nevertheless, both private banks and asset managers are working together to change this common perception, as well as encourage ESG investing, particularly among the rich millennials, in Asia.
Ho said the demographics of the wealthy is changing as wealth passed from first generation to the next.
‘A lot of the millennials, I think, would like to invest according to their value system,’ she said. Hence, offering ESG products targeting the wealthy millennials makes sense for long term, she added.