Trustee and Fiduciary Services Global Asset Management Industry Insights

Prime, Futures and Securities Services 8 TRENDS IMPACTING INVESTMENT STRATEGIES Sustainable investing and climate change are together a megatrend that is becoming a focus for regulators globally, something we also reference in our “Embracing Complexity” infographic published earlier this year. Rather than being something that we should do, it’s becoming something that we must do, with proposals currently being implemented into legislation. At a high level, the European Commission is looking at areas such as disclosure, suitability, benchmarks and the introduction of an EU-wide taxonomy. Work in these areas will continue to run through 2019 and up to 2022. Although the EU Commissions’ Sustainability Action Plan might be argued to be the most ambitious of its kind, we note that a number of other regulatory and industry bodies are also looking to introduce their own stamps on this megatrend. The global framework for sustainable investing ranges from legislation to self-regulation. For example, Hong Kong is just starting to look at sustainable investing from the perspective of disclosures. It’s not too surprising, then, that 96% of survey respondents cite sustainable investing as the most significant trend to impact investment strategies over the next five years. Demand for infrastructure solutions are also growing in Europe amid low returns from more conventional asset classes such as bonds. Some 63% of survey respondents state this would be the second most likely area to impact investment strategies over the medium term. In terms of popularity, other areas of focus are ETFs at 43%, followed by emerging markets and renewable energies at 41%, and then crypto currencies at 14%. ETFs Infrastructure investment Emerging markets Sustainable investment 96% 63% 41% 43% 41% 14% 2% Which top 3 trends will impact your investment strategies the most over the next 5 years? Q2 Crypto currencies Other Renewable energy