Skip to content
Back to Insights
  • Video
  • Sustainability
    • Environmental
    • Transition to Net Zero
    • General Sustainability

HSBC ESG Sentiment Survey - Caught in the crossfire

By Wai-Shin Chan, Head of Climate Change Centre and ESG Research

Video

The survey, conducted between 7-30 June 2022, had a sample size of 340 from professionals working in financial services in global regions, in roles related to ESG decision making. Respondents represent 320 institutions with USD8 trillion in assets under management.

  • What surprised us: The level of ESG incorporation actually fell over the past 12 months. Interest in biodiversity is still low, despite growing media attention. From a fixed income perspective, we were also surprised that using ESG labelled bonds was not a preferred approach. The build-out of ESG resources was more focused on process than people and data.
  • Sustainability objectives: As global ESG fund regulations tighten, over 40% of respondents have sustainability as a primary or secondary fund objective. Respondents in Europe were much more likely to have such objectives than those in North America.
  • Slightly lower intentions: The intention to incorporate ESG into investment decisions over the next 12 months fell to just over half, and the figure for the past 12 months also declined. Those with assets in Europe and North America were most likely to have lower intentions – perhaps due to geopolitics.
  • Incorporating ESG: The level of ESG that is incorporated into investment decision making fell slightly – a trend that was noticeable across all regions, asset classes and assets under management.
  • Which ESG issues matter most: A new option of ‘strategy and risk management’ was the top governance issue – we think this is important during times of uncertainty. Climate change remains the top environmental issue for respondents over the next 12 months.
  • War and the energy transition: Respondents broadly believe that the transition will be slower in the short term, but faster in the medium and long term. Those operating in North America were most negative on the speed of the energy transition. Most respondents would invest in renewables in the next 12 months, except North America where it was oil & gas. Of those who selected renewables, solar was the preferred technology by far.
  • ESG strategy: There was no change in the approach to ESG, with ‘Integration’ remaining the top choice.
  • Corporate perceptions: European corporates are perceived to be the most strategic when it comes to sustainability. Public perception was still the most important reason why companies embrace sustainability.
  • ESG drivers: 40% of respondents believed that businesses (through disclosure and actions) had the most responsibility to drive sustainability, moving clear of regulators, which fell to around a third.
  • ESG standards: The belief that corporate sustainability reports were ‘true and accurate’ fell somewhat. Over half of respondents think there should be a particular standard that corporate ESG disclosures should follow – this sentiment was strongest in Europe.
  • Fixed income: The preferred ESG approaches were integration, negative screening and external ratings. We were surprised that using labelled bonds was not a preferred approach.
  • ESG infrastructure: The focus of respondents is on their overall ESG process (i.e. internal frameworks and methodology) as opposed to investing in more people or more data. We find it encouraging as we believe the development of a proper ESG process is critical.

First published 18th July 2022.
Would you like to find out more? Click here to read the full report (you must be a subscriber to HSBC Global Research).

To find out more about HSBC Global Research or to become a subscriber get in touch at askresearch@hsbc.com.

The following analyst(s), who is(are) primarily responsible for this document, certifies(y) that the opinion(s), views or forecasts expressed herein accurately reflect their personal view(s) and that no part of their compensation was, is or will be directly or indirectly related to the specific recommendation(s) or views contained in this research report: Wai-Shin Chan, CFA, Jonathan White and Yaryna Kobel

This document has been issued by the Research Department of HSBC.

HSBC and its affiliates will from time to time sell to and buy from customers the securities/instruments, both equity and debt (including derivatives) of companies covered in HSBC Research on a principal or agency basis or act as a market maker or liquidity provider in the securities/instruments mentioned in this report.

Analysts, economists, and strategists are paid in part by reference to the profitability of HSBC which includes investment banking, sales & trading, and principal trading revenues.

Whether, or in what time frame, an update of this analysis will be published is not determined in advance.

For disclosures in respect of any company mentioned in this report, please see the most recently published report on that company available at www.hsbcnet.com/research.

Additional disclosures

1 This report is dated as at 18 July 2022.

2 All market data included in this report are dated as at close 15 July 2022, unless a different date and/or a specific time of day is indicated in the report.

3 HSBC has procedures in place to identify and manage any potential conflicts of interest that arise in connection with its Research business. HSBC's analysts and its other staff who are involved in the preparation and dissemination of Research operate and have a management reporting line independent of HSBC's Investment Banking business. Information Barrier procedures are in place between the Investment Banking, Principal Trading, and Research businesses to ensure that any confidential and/or price sensitive information is handled in an appropriate manner.

4 You are not permitted to use, for reference, any data in this document for the purpose of (i) determining the interest payable, or other sums due, under loan agreements or under other financial contracts or instruments, (ii) determining the price at which a financial instrument may be bought or sold or traded or redeemed, or the value of a financial instrument, and/or (iii) measuring the performance of a financial instrument or of an investment fund.

This document has been issued by The Hongkong and Shanghai Banking Corporation Limited, which has based this document on information obtained from sources it believes to be reliable but which it has not independently verified. Neither The Hongkong and Shanghai Banking Corporation Limited nor any member of its group companies (“HSBC”) make any guarantee, representation or warranty nor accept any responsibility or liability as to the accuracy or completeness of this document and is not responsible for errors of transmission of factual or analytical data, nor is HSBC liable for damages arising out of any person’s reliance on this information. The information and opinions contained within the report are based upon publicly available information at the time of publication, represent the present judgment of HSBC and are subject to change without notice.

This document is not and should not be construed as an offer to sell or solicitation of an offer to purchase or subscribe for any investment or other investment products mentioned in it and/or to participate in any trading strategy. It does not constitute a prospectus or other offering document. Information in this document is general and should not be construed as personal advice, given it has been prepared without taking account of the objectives, financial situation or needs of any particular investor. Accordingly, investors should, before acting on it, consider the appropriateness of the information, having regard to their objectives, financial situation and needs. If necessary, seek professional investment and tax advice.

The decision and responsibility on whether or not to purchase, subscribe or sell (as applicable) must be taken by the investor. In no event will any member of the HSBC group be liable to the recipient for any direct or indirect or any other damages of any kind arising from or in connection with reliance on any information and materials herein.

Past performance is not necessarily a guide to future performance. The value of any investment or income may go down as well as up and you may not get back the full amount invested. Where an investment is denominated in a currency other than the local currency of the recipient of the research report, changes in the exchange rates may have an adverse effect on the value, price or income of that investment. In case of investments for which there is no recognised market it may be difficult for investors to sell their investments or to obtain reliable information about its value or the extent of the risk to which it is exposed. Some of the statements contained in this document may be considered forward looking statements which provide current expectations or forecasts of future events. Such forward looking statements are not guarantees of future performance or events and involve risks and uncertainties. Actual results may differ materially from those described in such forward-looking statements as a result of various factors.

This document is for information purposes only and may not be redistributed or passed on, directly or indirectly, to any other person, in whole or in part, for any purpose. The distribution of this document in other jurisdictions may be restricted by law, and persons into whose possession this document comes should inform themselves about, and observe, any such restrictions. By accepting this report, you agree to be bound by the foregoing instructions. If this report is received by a customer of an affiliate of HSBC, its provision to the recipient is subject to the terms of business in place between the recipient and such affiliate. The document is intended to be distributed in its entirety. Unless governing law permits otherwise, you must contact a HSBC Group member in your home jurisdiction if you wish to use HSBC Group services in effecting a transaction in any investment mentioned in this document.

Certain investment products mentioned in this document may not be eligible for sale in some states or countries, and they may not be suitable for all types of investors. Investors should consult with their HSBC representative regarding the suitability of the investment products mentioned in this document.

HSBC and/or its officers, directors and employees may have positions in any securities in companies mentioned in this document. HSBC may act as market maker or may have assumed an underwriting commitment in the securities of companies discussed in this document (or in related investments), may sell or buy securities and may also perform or seek to perform investment banking or underwriting services for or relating to those companies and may also be represented on the supervisory board or any other committee of those companies.

From time to time research analysts conduct site visits of covered issuers. HSBC policies prohibit research analysts from accepting payment or reimbursement for travel expenses from the issuer for such visits.

The Hongkong and Shanghai Banking Corporation Limited is regulated by the Hong Kong Monetary Authority.

© Copyright 2022, The Hongkong and Shanghai Banking Corporation Limited, ALL RIGHTS RESERVED. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, on any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of insert issuing entity name. MCI (P) 037/01/2022, MCI (P) 017/10/2021

Global Research

HSBC Global Research provides information, insights and thought-provoking ideas.
  • Sustainability
    • Environmental
    • Transition to Net Zero
    • General Sustainability

Find out more

For more information on gaining access to Global Research, ASK Research using the button below.
ASK Research