Sustainable Investing: PIMCO’s Environmental, Social and Governance (ESG) Initiative

As part of PIMCO’s sustainability initiative, we are creating a dedicated investment platform focused on ESG-related opportunities.

PIMCO has incorporated sustainability factors in the investment process for decades. The process emphasizes rigorous analysis of broad secular trends, which are at the core of both global sustainability and long-term asset returns. In recent years, PIMCO has developed a platform that will support ESG-focused investment solutions. In this Q&A, Kwame Anochie, a member of PIMCO’s ESG leadership team, discusses the evolution of environmental, social and governance investing globally and at PIMCO.

Q: Why should investors and investment managers focus on sustainability issues with their investments?

A: Sustainable investing makes good business sense. It can help mitigate risks and potentially improve the return profile of an investment portfolio, and it is an intellectually engaging objective as well.

At PIMCO, we are in the business of delivering risk-adjusted returns for our clients in a manner that is sustainable over the long term. That means making sure that the investments we make on their behalf represent business models that are competitive not only today but well into the future. We complement the traditional analysis of companies’ financial statements with careful consideration of intangibles and secular trends, which when they materialize can have a profound impact on the health of balance sheets. Changing demographics is one example of a secular trend that could affect investors everywhere: As the world’s population grows in numbers and in many countries people live longer, collectively we don’t think only about securing a better future for our children; we also want a bright future for our older selves. S