Nine out of ten investors in “real assets” say they expect to increase their focus on environmental, social and governance analysis in the coming five years, according to a survey released on Friday (17 January).
The report, from Macquarie Infrastructure and Real Assets, found that 91% of real asset investors expect to increase their focus on sustainability in the next five years, driven by the belief that it will lead to enhanced returns and align them with community expectations.
“Investors in the real asset sector have reached an inflexion point,” says Phil Peters, head of the Client Solutions Group at Macquarie Asset Management.
Peters says there is a growing consensus that sustainability strategies can be pursued to deliver value for investors while driving positive change in communities.
“To harness this exciting opportunity, our industry needs to bridge the ESG skills gap and significantly improve measurement and reporting tools,” he added.
The research was carried out among 150 investors with combined assets exceeding $20trn. Five years ago, the same survey found that only 58% of investors said they were looking to increase their focus on ESG.
Despite the growing consensus that proactive ESG strategies have the potential to create better managed companies and enhanced investor returns, the survey reveals that the largest barrier to making positive ESG allocations is an absence of in-house expertise.
Of those surveyed, only 24% from the Americas and 21% from Asia had a dedicated ESG function. This compares to 72% from Europe, the Middle East and Africa and 71% from Australia.