Capital market issuers in Europe are attaching greater importance to sustainable finance than a year ago, despite the Covid-19 pandemic, and Jersey and Guernsey can play a key part in supporting that trend.
So says the recently published Sustainable Financing and Investing Survey 2020 from HSBC, which found that the pandemic has strengthened belief in sustainability for more than a third (36%) of European issuers.
Three-quarters (77%) also said the pandemic has either reinforced their commitment to environment, social and governance (ESG) or made them realise they had paid too little attention to the social component of ESG.
European issuers are also now the most committed in the world to environmental and social issues, according to the survey, with 95% saying these issues are ‘very important’ (76%) or ‘somewhat important’ (19%), compared with 93% globally.
The survey also found that Europe leads the way in terms of investors feeling a responsibility to avoid investments with negative impacts on environment and society – 61% of European investors said they feel this way, compared with 53% globally.
Aline Ayotte (pictured), Head of Commercial Banking at HSBC Channel Islands and Isle of Man, said: “Guernsey and Jersey have established themselves as leading players in the cross-border investment funds space right in the heart of Europe, administering collectively approaching £600bn of assets.
"With Europe at the forefront of international efforts to fight climate change and looking to act as a world leader in sustainable finance, the islands have a significant opportunity to support issuers and investors in the transition to a net zero global economy.”
Daniel Klier, global head of sustainable finance, HSBC, added: “Sustainable finance has moved into the mainstream of the capital markets faster than we expected and, as that happens, ESG deals are increasingly being judged as a traditional asset rather than a reflection of commitment to social and environmental issues.
“This is an optimistic development, as the long-term success of the market will be shaped by the ability of ESG investments to compete with other traditional options on risk and return.”
• The HSBC report can be viewed here