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Please be advised that future verbal and written communications from the bank may be in English only. These communications may include, but are not limited to, account agreements, statements and disclosures, changes in terms or fees; or any servicing of your account.

Por favor, tenga en cuenta que es posible que las comunicaciones futuras del banco, ya sean verbales o escritas, sean únicamente en inglés. Estas comunicaciones podrían incluir, entre otras, contratos de cuentas, estados de cuenta y divulgaciones, así como cambios en términos o cargos o cualquier tipo de servicio para su cuenta.

Informamos que as futuras comunicações do banco, verbais e escritas, podem estar disponíveis apenas em inglês. Essas comunicações podem incluir, entre outras, acordos de conta, extratos de conta e divulgações, alterações aos termos ou tarifas, ou qualquer tipo de serviço pertinente à sua conta.

仅此通知,本行即日起发出的口头及书面通信可能将只提供英文版本。这些通信可能包括但不限于账户协议,账单和通知,条款或费用变更;或任何为您账户提供的服务。

Please be advised that future verbal and written communications from the bank may be in English only. These communications may include, but are not limited to, account agreements, statements and disclosures, changes in terms or fees; or any servicing of your account.

Por favor, tenga en cuenta que es posible que las comunicaciones futuras del banco, ya sean verbales o escritas, sean únicamente en inglés. Estas comunicaciones podrían incluir, entre otras, contratos de cuentas, estados de cuenta y divulgaciones, así como cambios en términos o cargos o cualquier tipo de servicio para su cuenta.

Informamos que as futuras comunicações do banco, verbais e escritas, podem estar disponíveis apenas em inglês. Essas comunicações podem incluir, entre outras, acordos de conta, extratos de conta e divulgações, alterações aos termos ou tarifas, ou qualquer tipo de serviço pertinente à sua conta.

仅此通知,本行即日起发出的口头及书面通信可能将只提供英文版本。这些通信可能包括但不限于账户协议,账单和通知,条款或费用变更;或任何为您账户提供的服务。

Senior businessman holding wind turbine model

Perspectives

Why ignoring sustainability is a portfolio risk

David Bailin

By David Bailin

Chief Investment Officer

Harlin Singh, Global Head of Sustainable Investing

March 23, 2021Posted InInvestment Strategy

In past years, an investor could emphasize or ignore sustainability factors at their discretion, with personal views not market fundamentals driving their choice. But that has been changing rapidly, with sustainability increasingly functioning as a driver of performance and portfolio stability. For instance, according to Morningstar, in Q1 2020, sustainable strategies saw a net inflow of $45.6BN, compared to an outflow of $384.7BN for the overall fund universe amid the coronavirus pandemic market sell-off. Global sustainably invested AUM (measured primarily by ESG data integration) reached $40.5T in 2020. That represents roughly 33.8% – 40.5% of the estimated $100T - $120T total global AUM under professional management.

Despite how often it is talked about, we are often asked: What is a sustainable investment? Broadly, sustainable investing encompasses many different methods, and means different things to different investors, but the end goal is to use Environmental, Social, and Governance data to ensure that an investor’s core portfolio is constructed in a manner that accounts for not only what each company is doing business in – but also how each company is doing business.

This ranges from excluding companies that don’t meet the investor’s values (i.e. excluding "sin" stocks) to evaluations of whether a business has a sustainable business model or has a place in a future sustainable economy. Thus, sustainable investing has shifted from primarily focusing on a short list of exclusions or inclusions to broader thematic views. For example, we see many strategies exclude the entire fossil fuels sector both because of the harm caused by greenhouse gas emissions but also due to the risk to those assets in a world shifting towards a post carbon future. The shift from values-alignment to a concept of “do no significant harm” has been the primary driver of a growth in the list of portfolio exclusions. On the other end of the spectrum, are investors seeking value in sustainable themes – such as renewable energy, clean water, affordable housing, and healthcare.

Download: CIO Strategy Bulletin