ESG

Based on our long-standing views of the financial benefits of sustainability, we integrate some level of ESG (Environmental, Social, and Governance) factor analysis across all our investment processes, and particularly for our sustainable investment strategies.

In a world grappling with escalating water issues, prioritizing water as a strategic business imperative has never been more critical. The operational and financial impacts of water-related risks have started materializing. Our conviction is that companies must consider and manage water as the long-term strategic and operational risk it can represent.

While investors are encouraged to consider climate change in their portfolios, to meet regulatory requirements and mitigate climate-related risks, a number of questions remain.

PFAS have been widely used for decades due to their unique properties in various domestic and industrial applications. They are resistant to water and virtually indestructible. They are also seen as the poison of the century. Where do we stand in terms of regulation? What are the PFAS-related risks? Where are the opportunities?

In an ever-evolving financial landscape dominated by data-driven decision-making and economic uncertainty, understanding the nuances of fixed income investing is paramount.

At Candriam, we are active owners and debtholders. We exercise our rights when we believe action can enhance long-term value for our clients and ultimate beneficiaries.

While these objectives are laudable, there are methodological obstacles. The initial objectives of Solvency II were harmonization, financial stability and policyholder protection. The text had therefore been conceived as a risk-based regulation, based on the valuation of the balance sheet on a mark-to-market basis and on capital requirements calibrated using Value at Risk (VaR) with a confidence level of 99.5%.

After a challenging period for green investing, marked by rising interest rates, supply chain issues, and overcapacity, companies committed to building a sustainable world could remain an attractive long-term option for investors seeking both financial returns and positive impact.

Despite constraints on both their human and financial capital, Small- and Mid-Sized companies (SMIDs) share similar business ambitions with their larger counterparts while competing for the same talent. They need talent to fuel their growth, yet that rapid growth can strain employees. Attracting and retaining talent, while simultaneously maintaining workforce productivity, poses a challenge.

With the infrastructure sector poised for growth after a tumultuous period caused by the pandemic and subsequent inflationary boom, which areas could offer investment opportunities?

The impact of the 2024 elections on the decarbonization theme is of paramount importance, considering that the year marks a significant electoral period globally with 64 countries and the European Union - representing nearly half of the global population - heading to the polls.

In the vast subject of the challenges and difficulties of climate analysis from an investor's point of view, scope 3 emissions emerge insistently as one of the main stumbling blocks.

After 2022, which covered the end of a decade of monetary policy loosening, 2023 has been the year of the repricing of the whole interest rate curve. The end of Central Banks’ "higher for longer" mantra supported a steepening of the yield curves and repriced real interest rates which are back now in positive territory, for the first time in close to ten years.

Defined as the “stock of renewable and non-renewable natural resources (e.g.,plants, animals, air, water, soils, minerals) that combine to yield a flow of benefits to people” by the Natural Capital Coalition, natural capital is at the source of everything that surrounds us.

COP28 ended with a final statement that can be considered historic, mentioning for the first time the need to transition away from fossil fuels. However, this landmark deal should be considered as the start of a more ambitious journey, that will remain dependent on governments’ ability to step up their commitments and action.

As the COP28 kicks off at the end of the month in Dubai, we are paying close attention to this highly anticipated event, albeit mixed expectations.

There are several examples of emerging markets where corporate governance standards and ESG disclosure have evolved in recent years, among which China, India, South Korea, Taiwan…

Good news! The five-year survival rate for women diagnosed with breast cancer in the United States is now 90%[1]. Unfortunately, when looking at other statistics, the outlook worrying: one in eight women will develop an invasive form of breast cancer during their lifetime. In 2020, two million new cancer cases were diagnosed worldwide. Breast cancer is the most common cancer type among women and the second deadliest, following lung cancer. To better understand the urgency of treatments: in 2020, 685,000 women lost their lives from breast cancer.

If investors are continually asking companies to share more data on themselves, how can we possibly see into the supply chains?

One clear conclusion is that pension fund-related institutions which have not yet embraced ESG will find themselves suddenly launched two squares forward on the chessboard, as they rush to integrate ESG into the overall governance of how they manage or administer pension assets and plans.

While human activity is pushing the Earth’s resources to the limit, it is time to rethink our consumption habits.

In our 2022 Engagement report, we offered a case study describing how we begin a topical campaign.

At Candriam, we are both more active and more demanding in our engagement activities, an attitude shared by several other investors, mostly European.

The Russian invasion of Ukraine has been yet another wake-up call for our need for energy independence. While Europe's reliance on Russian gas was evident, Russia is also one of the largest oil producers, exporting half of its production to Europe before February 2022.

Sustainable Finance Disclosures Regulation (SFDR), mandatory ESG disclosure obligations, was introduced by the European Union to improve transparency in the market for sustainable investment.