ESG, on the minds of hedge funds too?


Societe Generale’s survey reveals growing ESG importance for capital allocators

esg strategy chartCertainly, ESG – Environmental, Social & Governance – has taken on increased importance for companies seeking to measure the sustainability of their business. 
But how important is it becoming for hedge funds to incorporate this ESG data into their firms’ philosophies and trading strategies?

To gauge the extent that capital allocators are using this information to inform their investment decisions, Societe Generale’s Capital Introduction team conducted a survey as part of their most recent Hedge Fund Webinar Series.

The survey found strong momentum towards ESG-focused strategies, with three-in-ten (29 percent) already making allocations and an additional 51 percent saying they planned to do so within the next 12 months. 

“The survey results largely follow what we’ve been hearing during our conversations with investors over the past few years,” said Rick Ryan, Societe Generale’s Head of Capital Consulting, Americas. “Investors are increasingly conscious of the importance of factoring the broader impact of their investments into their allocation decisions.” 

esg allocation chartWith nine-in-ten (90 percent) of the capital allocators surveyed saying that they weigh ESG criteria in their allocation process, “It’s clear that there is strong demand for hedge funds to incorporate ESG into their trading strategies and broader business practices, hiring and promotions for example, to meet investor demand,” added Alex Hill, SG’s Director of Capital Consulting in London.

Societe Generale was recently recognized as the prime broker with the Best Capital Introduction Service by HFM at their US Quant Services Awards. Societe Generale’s Capital Consulting team prides itself on creating meaningful dialogue between hedge fund clients and institutional investors globally via deep market knowledge and an expansive industry network. 

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