MSIM's sustainable investing philosophy is anchored on the belief that there are a spectrum of approaches to utilizing material environmental, social and governance (ESG) information and criteria to deliver strong returns for clients. We are committed to ESG-informed investment decision making and we seek to leverage our influence to drive better investment performance alongside improved sustainability practices and outcomes through thoughtful, value-added investee engagement. MSIM offers a variety of sustainable investing options, from funds that integrate ESG factors as an intrinsic part of the investment process, to thematic Sustainable Funds that seek to achieve attractive financial returns alongside positive impact.
MSIM has identified four focus areas that are of strategic importance to our thematic research and company engagement/asset stewardship work that are both potentially material to our investment goals and vitally important from a systemic perspective. These themes touch all of our investment teams to greater and lesser degrees depending on asset class, geography, and investment style and strategy.
Supporting the transition to a low carbon economy and net zero alignment
Supporting business models that reduce impact on natural resources and that reduce waste generation
Supporting businesses and business practices that create a more just, equitable and inclusive society
Supporting decent work across the entire value chain and helping to create resilient workforces in the face of innovation and change
in Strategy & Governance; Listed Equity Incorporation and Active Ownership; Corporate Fixed Income; and Securitized Fixed Income
in Property, Infrastructure, and Sovereign Fixed Income
Green Star recognition for Core and Value-add/Opportunistic Real Estate funds
votes against say on pay proposals
votes against management
support for climate-related proposals overall
sustainability-related engagements with company management or boards in 2020
ESG Strategies that incorporate impact investing and/or Environmental, Social and Governance (ESG) factors could result in relative investment performance deviating from other strategies or broad market benchmarks, depending on whether such sectors or investments are in or out of favor in the market. As a result, there is no assurance ESG strategies could result in more favorable investment performance.
MSIM's Sustainability Council comprises senior, cross-functional business leaders and investment leaders who oversee and guide MSIM's support for the sustainable investment strategies of each business, including: promoting definitions and frameworks for Sustainable Investing; supporting the continued innovation of ESG products and solutions; championing Sustainable Investing across MSIM's staff and culture; and ensuring business readiness for evolving client/regulator demands.
The Sustainability Team is responsible for developing MSIM's ESG investment integration standards, helping to launch thematic Sustainable Funds, advising clients on sustainability matters, and producing sustainability data, tools and research in support of our investment teams. The Sustainability Team also comprises the Global Stewardship function, which coordinates our stewardship and investee engagement agenda.
Our portfolio management teams are ultimately responsible for evaluating the ESG risks and opportunities of each investment decision or asset, and of the portfolio as a whole. In doing so, they leverage ESG information and insights in a way that is aligned with their existing investment philosophy and strategy. Our largest teams or asset class platforms have appointed at least one dedicated ESG research specialist to lead this work for the relevant group.
The Institute is dedicated to accelerating the adoption of sustainable investing by partnering across the firm to foster innovation, help develop the next generation of sustainable investing leaders and generate insights that inform and empower investors.
MSIM offers a range of customized and dedicated sustainable investing capabilities spanning multi-asset and private markets. For example, for customized multi-asset portfolios, we may customize a basket of securities or funds according to the particular sustainability preferences of the client. On the private markets side, we offer thematic impact investing opportunities across a range of focus areas, including climate and social impact.