Reprinted from Institutional Investor. Michael Molitor is a Senior Fellow with the Ray C. Anderson Foundation
Norway’s Government Pension Fund Global, the world’s largest sovereign wealth fund, with $860 billion under management, has missed out on $1.9 billion in additional profits as a result of its decision to divest all of its tobacco holdings in 2010. The story that reported this fact, which ran in the Financial Times , goes on to suggest that fund managers should reconsider their investments in tobacco companies, as the sector is generating impressive returns, well above many key performance benchmarks.
This originally appeared in Bloomberg Markets Magazine
Getting a handle on environmental, social, and governance information has become more crucial for investor relations officers and other corporate executives. A lot of money is invested in accordance with ESG-related guidelines these days. The 1,380 institutions that have signed the United Nations’ Principles for Responsible Investment, for example, oversee $59 trillion of assets.