New York – From July 9 to July 10, the 2022 Caixin Summer Summer was held. In the section “Exploring the Sustainable Development Driven by Market”, Li Haipeng, deputy general manager and chief investment officer (fixed income) of China Southern Asset Management, shared his opinions.
Host: China Southern Asset Management is an early ESG investment institution in China. Deputy General Manager Li Haipeng is also the deputy leader of ESG leading group of China Southern Asset Management. How does China Southern Asset Management, a mutual fund company, understand ESG’s investment, implement ESG from strategy implementation to internal evaluation, including KPI’s internal performance evaluation?
“Different from traditional financial data, ESG’s indicator system is based on environmental, social, governance and other factors, and focuses on the long-term value-creating ability of enterprises. Therefore, at present, the pricing factor of ESG is increasingly obvious, and everyone can see this from our investment. We believe that in the medium and long term, high-quality enterprises and high-quality investment targets with excellent ESG performance not only have better financial indicators, but also have stronger resilience and long-term growth potential. Take the field of fixed income as an example, originally we mainly used traditional credit analysis to screen high-quality targets. Now, we are also trying to apply the strategy of ESG to evaluate enterprises in more dimensions, which can play a role in risk identification and prevention to a certain extent,” Li Haipeng said.
Li Haipeng introduced that China Southern Asset Management became a member of PRI in 2018 and was also one of the earlier companies involved in ESG investment in China. At that time, ESG’s data and information were extremely scarce, which was the initial difficulty. Therefore, we can only explore different ways to solve some problems encountered in the process of ESG localization. At present, Fintech is the best solution.
“Through years of accumulation and deposition, our ESG database and system are gradually being established and improved. Recently, we have completed the construction of ESG comprehensive information platform of China Southern Asset Management. This platform consists of three parts: data, model and application, including internal and external ESG rating data, as well as abundant underlying data, climate-related databases and our internal research report system, including some multi-dimensional ESG information such as ESG disputes and voting tracking, which is deeply integrated into the company’s investment and research integration platform. The detailed data information and visual cross-section enable our investment researchers to evaluate the performance of ESG better, provide intellectual tools and data support with local characteristics for portfolio management, risk prevention and control, model construction and conscientious portfolio management, and continuously deepen the application of ESG in investment,” Li Haipeng said.
Li Haipeng said that as the rating system of ESG, which is an essential link in the integration process of China Southern Asset Management, the ESG system independently developed by ESG currently involves 17 subjects, 39 sub-subjects of ESG, and 115 sub-categories of evaluation indicators. The whole index system is optimized according to the local validity, and it is in the coverage of rating. By the end of last year, the rating system of ESG of China Southern Asset Management had covered more than 4,500 A-share listed companies and 6,364 bond subjects. On this basis, it was continuously supplementing data and optimizing methodology. In addition to the externally collected data, researchers will continue to track the performance of ESG of enterprises. Its research data is a very important first-hand data source. With the improvement of the ability to identify the substantive problems of ESG, the company’s ESG system is constantly being optimized.
“In addition to the rating system, the management structure and process system are also important in ESG. Having created this system, we must apply it to our investment practice. We have established ESG process management system for investment, research and risk management of different asset classes, and built the whole process system of ESG investment. Specifically, in addition to quantitative and qualitative ESG analysis of investment targets by means of Fintech and researchers, our rating results will be directly linked to our risk control system, and fund managers will give risk warning and intercept when placing orders in daily life. Through some perfect transaction management processes, we perfectly embed the effectiveness of ESG rating into our process management process, and do a good job in related integration and integration,” Li Haipeng said.
Media Contact
Company Name: China Southern Asset Management
Contact Person: Si Chen
Email: Send Email
Country: China
Website: http://www.southernfund.com/en/
