In recent years, companies listed on the STAR Market are becoming the "vanguard" of ESG information disclosure, which highlights that technology companies are paying more attention to the construction of ESG systems.
On March 21, the Shanghai Stock Exchange officially released the ESG (Environmental, Social and Corporate Governance) Index (hereinafter referred to as the "SSE STAR Market ESG Index"), which will not only further enrich the index system of the STAR Market, but also promote the companies listed on the STAR Market to better practice the concept of sustainable development. In recent years, companies listed on the STAR Market are becoming the "vanguard" of ESG information disclosure, which highlights that technology companies are paying more attention to the construction of ESG systems. At the same time, ESG investment has also begun to tilt towards the high-tech industry, with investment in the technology sector increasing year by year, and large ESG funds are heavily invested in technology stocks.
Information disclosure is gradually improving
The SSE STAR Market ESG Index selects the 50 listed companies with the highest ESG ratings from the SSE STAR Market as index samples, aiming to reflect the overall status of the securities of listed companies with good ESG performance on the STAR Market. The sampling method is both representative and investable, and comprehensively considers market value coverage, investment capacity and ESG evaluation, so as to provide more reference for investors in stock selection and investment.
As a new-age investment philosophy that focuses on corporate environmental, social, and governance performance rather than financial performance, ESG has become a "yardstick" to measure corporate sustainability performance. With the continuous advancement of the "dual carbon" goal, listed companies in mainland China are paying more and more attention to ESG information disclosure. Since 2017, mainland regulatory authorities and stock exchanges have successively issued relevant policies to stipulate the ESG information disclosure of domestic listed companies, and ESG performance has been paid attention to by more and more corporate stakeholders as an evaluation criterion, further promoting the expansion of ESG investment. In fact, from the perspective of investors, companies with higher ESG performance will have lower business development risks in the context of energy transition, and will naturally be more likely to gain favor.
This year's government work report pointed out that we should accelerate the promotion of high-level scientific and technological self-reliance and self-reliance. Give full play to the advantages of the new national system and comprehensively enhance the ability of independent innovation. Strengthen the layout of the basic research system, provide long-term and stable support for a number of innovation bases, advantageous teams and key directions, and enhance the original innovation capabilities. The release of the SSE STAR Market ESG Index comes at a timely time, and the industry believes that technology companies are constantly exploring the integration of ESG concepts into the construction of investment and financing.
From 2020 to 2022, the number of listed companies disclosing ESG special reports on the STAR Market has increased year by year, to 25, 95 and 140, respectively, and the company coverage rate has increased from 9% to 27%.
High focus on high technology
For high-tech enterprises, responsible innovation is an important way to balance business value and social responsibility, and practice ESG concepts. In recent years, ESG investment has increasingly tilted towards the theme of high-tech industries.
The Prospective Industry Research Institute pointed out that in the past four years, the investment strategy of mainland ESG funds has obviously tended to industrial, information technology, materials and other industries, and the investment in these fields has accounted for 70%-80%, showing that the market is deeply concerned about the high-tech industry. The high-tech sector has great growth potential and investment value, especially in the industrial sector, which continues to rise.
The same is true in overseas markets, where asset management companies are the mainstream ESG investment and trading ecosystem. CNBC News reported that the world's major asset management companies generally regard large technology companies as high-return targets and are betting heavily on technology stocks. In the ESG investment basket of asset management companies, technology assets are increasing.
According to data compiled by Bloomberg Industry Research, ESG-themed funds currently hold more technology assets than any other sector, and the top 5 heavy stocks of Xtrackers MSCI, the largest ESG exchange-traded index fund in the United States, are all technology stocks, namely Microsoft, Apple, Nvidia, Amazon and Meta, accounting for nearly 24% of the total holdings. As of the end of March, Xtrackers MSCI has risen nearly 9% this year, with the asset allocation of the largest holding industry technology exceeding 30%, and the second largest holding industry accounting for only 13.5%.
Dave Nadig, chief investment officer at data provider ETF Trends, said ESG investing is betting heavily on technology stocks because it sees technology as one of the key tools to drive the energy transition.
However, there is no unified definition of the definition and definition of ESG investment, and the definition of most ESG funds in the market is mainly reflected in the selection and allocation of assets, such as new energy, environmental protection, low-carbon technology, etc., which seems to be more like sector industry funds, and it is difficult to give real feedback on corporate ESG performance. Based on this, ESG investment is tilted towards the high-risk, high-return technology industry, and there are bound to be many problems.
In this regard, Crystal Geng, ESG analyst at BNP Paribas Asset Management, said that due to the lack of historical data on the long-term performance of digital and intelligent technologies such as artificial intelligence, it is difficult to reasonably assess investment risks, "We don't have the tools or methods to quantify risks." ”
Marcel Stotzel, portfolio manager at Fidelity International, said that investing in high-tech industries such as artificial intelligence is actually a short-term risk for investors.
Drive new growth in climate tech
Ernst & Young Greater China Managing Partner Bi Shunjie pointed out that global energy technology innovation has entered a highly active period, and the wave of new technology, new material and industrial revolution is sweeping. With the continuous advancement of the "dual carbon" goal, the climate technology industry has entered a new era of green and low-carbon transformation and innovation-driven development.
According to the white paper "Capital Empowerment, China's Climate Technology Industry Towards 2060" jointly released by EY and Shanghai Yangtze River Delta Business Innovation Research Institute, from the perspective of the capital market, the market size of green financial products such as green bonds and green credit continues to expand to support the development of the climate technology industry, the mainland A-share market, especially the Science and Technology Innovation Board, continues to provide direct financing channels for technology innovation enterprises, and diversified financial instruments continue to promote the flow of capital to the climate technology industry and promote its healthy development.
From the perspective of the A-share market, the Science and Technology Innovation Board has gradually become the main position for the listing of "hard technology" enterprises, and continues to empower enterprises to tackle key core technologies. The ESG operation and management of technology companies represent the cutting-edge level of global enterprises, and the direction of ESG strategy and business layout is profoundly related to the development direction of the new economy in the future.
"The multi-level capital market in the mainland has been established, and the climate technology industry should seize the opportunity of the times, make good use of the capital market as a 'booster' and 'catalyst', and promote a virtuous cycle of 'technology-industry-finance'. Ernst & Young Hard Technology Industry Center Audit Leader Tang Zhehui said frankly.
With the help of the reform of the registration-based system of the Science and Technology Innovation Board, leading enterprises in the climate technology industry, such as photovoltaic, wind power, power batteries, energy storage, energy conservation and environmental protection, have given priority to listing on the Science and Technology Innovation Board, forming a climate technology corps in the Science and Technology Innovation Board.
Jiang Bin, Secretary-General and Executive Vice President of Shanghai Yangtze River Delta Business Innovation Research Institute, said that the ESG investment concept has grown into a consensus in the field of financial investment in recent years, and in the context of the downward trend of global demand, the ESG concept is expected to give birth to new economic growth points in the field of climate technology and bring continuous help to the global economic recovery.
Text丨Reporter Wang Lin