BDO Unibank’s foray into sustainable investments continues to pay dividends even amid the pandemic. This follows the global trend of strong growth in environmental, social, and governance (ESG)-themed investments.
ESG: Sustainable Investments
Economic pundits observed that COVID-19 has only strengthened the importance of ESG as investors look for more resilient investments. Despite economic uncertainties brought about by the pandemic, ESG themed investments remained feasible.
Globally, assets under management (AUM) anchored on sustainable investments jumped 29% in the fourth quarter of 2020. This raises their assets to $1.7 trillion.
Domestically, BDO’s ESG Unit Investment Trust Fund (ESG UITF) posted returns of 13.95% and 19.90% in the last six and three months, respectively. Moreover, this led to end-December 2020. The ESG UITF is the first of its kind in the Philippines.
As of end-2020, the value of the AUM of this instrument grew 79% to PhP99.4 million from P55.5 million in 2016.
From Php55.5 million in 2016, the AUM of BDO ESG UITF have grown steadily to Php60.1 million in 2017, Php66.6 million in 2018, Php75.2 million in 2019, and Php99.4 million in 2020.
Bullish New Fund
The BDO ESG UITF followed a similar higher return performance shown by ESG funds globally. It simply proves the importance of sustainable business practices.
“While the Fund is still small, it has the potential to grow in size and importance as more investors are consciously looking for companies that protect the environment, are socially responsible, and practice good governance in a sustainable manner,” BDO said.
The BDO ESG UITF allows investors to see value in socially responsible companies as an investment destination for their funds. They get to invest in one fund that covers several companies, instead of investing separately in every local company that they believe creates a positive contribution to society.
“Its importance is further heightened during this time of the pandemic, as sustainable investment amplifies the Bank’s resiliency to unforeseen global or local crises” the Bank added.