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What investors often misunderstand is that despite having ‘environmental’ in its description, ESG integration screens often don’t exclude companies that damage the environment according to the 2022 Sustainability Report.

Private debt has several key advantages over equities and other forms of fixed income investing when it comes to influencing companies in the development and implementation of ESG commitments.

A new International Energy Agency report projects global renewable energy growth in the next five years will match that of the last 20, with renewables also set to overtake coal as the largest electricity source by 2025. Australian investors won’t have to look far to find stocks poised to benefit from this momentum shift.

“Sometimes, the market thinks we prioritise ESG factors above investment fundamentals,” says Perennial’s Emilie O’Neill. “But the reality is that it’s just another investment lens.”

For ESG discourse to matter, it must translate into quantifiable action. That means broadening the conversation beyond the close circle of sustainability converts and having tough conversations about capital flows.

In a special sitting Thursday, Parliament will vote on proposed price caps for coal and gas, which the government says will help curb soaring energy bills. Producers, which oppose the plan, have already seen their share prices drop.

Speaking on a fireside chat during The Inside Network’s recent ESG event in Tasmania, Nick Langley said that while infrastructure assets will continue carrying the burden of inflation there is likely more to be concerned about with REITS, both in the dominant US market and around the world.

Alternative investment manager Blackstone’s decision to limit redemptions from its $103 billion real estate investment trust has investors questioning whether such funds can continue to maintain strong performance as the broader real estate market deteriorates.

The RBA is keeping an open mind about a potential central bank digital currency in Australia, including running a pilot eAUD program next year. But many of the arguments in favour of a CBDC fall flat in the Australian context, says Assistant Governor Brad Jones.

The Australian Securities and Investments Commission is making good on promises to combat greenwashing, issuing its second set of fines against a company for misrepresenting the ESG bona fides of an investment product.

Increasing government expenditure on social infrastructure is driving huge levels of investment into the sector. There are now several options for retail and wholesale investors to gain exposure to this asset class, which was previously open only to institutional investors.

Recent research reveals high-net-worth investors have reduced slightly in number since last year while accumulating slightly more investable assets, with this cohort taking a “more subdued outlook” for the coming year. Investors’ asset class preference is also evolving to favour defensive investments.