ESG (environmental, social and governance) is still an unpopular investment strategy in Switzerland. How will it overcome this lack of enthusiasm? asks Gail Moss in IPE.
“There is still uncertainty about returns from ESG stocks,” says Peter Zanella, senior director at Willis Towers Watson Switzerland. “In my opinion there is not a clear picture that ESG returns are at least as good as returns from ‘normal’ stocks. And studies show that so-called ‘sin stocks’ are doing very well. As a company, we currently do not actively float ESG ideas.”
Thierry Bertheau, head of institutional client relations at, Robeco Switzerland, says: “It is steadily gaining awareness. But one hurdle to overcome is the lack of understanding, as well as clear definitions and standards. This could be helped by continuous education and insights. Another frequently mentioned reason is the focus on other priorities, such as funding ratios or performance.”
For those pension funds without access to sophisticated screening systems, a readily available list of possible stocks to be excluded is provided by SVVK ASIR (Swiss Association for Responsible Investments).
Many different ESG approaches are offered by asset managers, from standard benchmark-based exclusions to best-in-class or thematic investments.
But engagement is another way to tackle the issue.