The Road to ESG Investment in China

    ESG investment in China started around 2015. Until 2019, less than 1% of asset management companies used ESG as an analytical factor in their investment, but the proportion has rapidly risen to 16% in 2020. With the goal of "2030 carbon peak and 2060 carbon neutral", the society's put more and more attention on clean energy, green economy, and the derived green finance. ESG investing has once again become the focus of the market. However, how will China's ESG investment respond to the situation and embark on its own sustainable development path?

    The market-respected value investment coincides with the ESG concept. Starting from fundamental research, it is not difficult to find that the company's development strategy, corporate governance structure, and social responsibility which all considered in ESG investment are all in line with value investment. Moreover, in addition to the consideration of fundamental factors, ESG provides an updated dimension, including more information on the environment, social responsibility, and corporate governance, helping investors to understand the company.

    Globally, it is common for the government to promote the development of the ESG field, and China is not an exception. However, it is difficult for various countries to unify relevant standards, the acquisition and analysis of ESG data, as well as the understanding of different cultures and languages, the ESH investing requires a further development.