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Benedicte Gravrand, Opalesque London:
Environmental, socially responsible and governance (ESG) investing in BRIC (Brazil, Russia, India and China) and emerging market (EM) countries is important, according to Seth Freeman, CEO and CIO at EM Capital Management, a California-headquartered fund manager that specialises in emerging and frontier markets. He was speaking at the Jetfin conference "BRIC 2010" in Geneva on 13th April.
"We are really at the tip of the iceberg in terms of EM development," he said.
BRIC economies are projected to account for approximately 50% of global GDP by 2050. Indeed, a Goldman Sachs' report called "Dreaming with the BRICs: The path to 2050", noted that "the key assumption underlying our projections is that the BRICs maintain policies and develop institutions that are supportive of growth."
As for ESG investing, Standard and Poor's reported that "corporate governance remains one of the most important factors constraining the BRICs' attractiveness to foreign capital providers and, in particular, potential long-term shareholders." On the plus side, recent studies debunk belief that ESG investments implicitly provide lower returns than conventional analysis.
Opportunities can be found in the many EM sustainable and "green" funds but there are still few integrated ESG products.
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