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ESG and sustainable investing

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What is ESG?

For some of our customers, ESG (Environmental, Social, Governance) and sustainable investing has gained traction as an approach that considers ESG factors as well as financial objectives.

Environmental factors refer to the natural world, and include matters related to climate and nature, Social factors consider people and relationships, and include human rights and labour standards, while Governance factors consider how companies are managed.

As a global wealth manager, we are well placed to offer these investment options to our clients, and we have developed ESG insights and investment solutions that meet their preferences.

Explore ESG and sustainable investing products

Key features

Unlock opportunities

Our world is evolving: the changes happening in global economies and societies represent new avenues for growth and innovation. While all opportunities come with their own risks and uncertainties, some ESG and sustainable investing thematics offer strong investment potential.

Integrating these considerations into an investment approach provides a pathway for investors to capture new opportunities that are underpinned by global trends. [@investments-esg-outlookq4-source]

Build a resilient portfolio

Our analysis shows that investing in companies with strong ESG practices and following a broad-based and diversified approach can make an investment portfolio more resilient over the long-term.

Why is this the case? Companies with strong ESG profiles are better equipped to manage longer-term risks, such as climate change, regulatory shifts, and social issues. These companies benefit from lower capital costs and operational efficiency, which in turn improve stakeholder relationships, resilience to global economic shocks, and overall business performance.

Deliver potential capital growth

Evidence shows that companies with better Environmental, Social and Governance (ESG) credentials may be more likely to show better financial performance[@investments-esg-capitalgrowth-source].

ESG and sustainable investing products

At HSBC, we see three main ways to embed sustainability into an investment portfolio, which can be applied across portfolio allocations:

Investment solutions that seek stronger ESG performance, through either setting a minimum ESG score, favouring high performers, or excluding low performers in their investment approaches.

Investment solutions that focus on sustainability themes or sectors such as decarbonisation, energy transition, healthcare or climate tech, for example, aligning with the themes of the UN Sustainable Development Goals.

Investment solutions that seek to deliver intentional, positive and measurable outcome(s) and align to a predefined objective, measured using key performance indicators or established impact measurement frameworks.

Understand more about our ESG and sustainable investing products

Unit trusts

We offer actively-managed funds that follow our strict definition of sustainable investment, and ensure your peace of mind by curating best-in-class ESG and sustainable investing funds for you

Learn more about Unit trusts

Learn about the latest ESG Trend

Get the latest market coverage on major events around ESG and their implications on the investment world

Start your ESG and sustainable investing journey

HSBC investment account holders

Browse a list of available ESG and sustainable investing products that you can invest in through us.

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ESG stands for Environmental, Social and Governance. For some of our customers, ESG and sustainable investing has gained traction as an approach that considers ESG factors as well as financial objectives. Our analysis shows ESG and sustainable investing has the potential to do two things: unlock opportunities and help build a resilient investment portfolio.

We have analysed the reasons investors might consider ESG and sustainable investing as a part of their strategy. Our analysis shows it has the potential to do two things: unlock opportunities and help build a resilient investment portfolio.

The importance of diversification remains paramount when considering any investment strategy. Investors who pursue ESG and sustainable investing opportunities can mitigate the risks specific to these strategies by risk-sizing their thematic allocations or by balancing exposure across sectors and regions to avoid biases, in a similar fashion as in traditional investment approaches.

ESG and sustainable investing considers ESG factors alongside financial returns. Based on our analysis, investing in companies with strong ESG practices and following a broad-based and diversified approach can make an investment portfolio more resilient over the long-term.

There is no guarantee that ESG and sustainable investing products will produce returns similar to those of products which don’t have any ESG or sustainable characteristics. ESG and sustainable investing products may diverge from traditional market benchmarks. There is no standard definition of, or measurement criteria for, ESG and sustainable investing or the effect of ESG and sustainable investing products. ESG and sustainable investing and related measurement criteria are (a) highly subjective and (b) may vary significantly across and within sectors.

Please note that past performance is not indicative of future performance.

We offer different ESG and sustainable investing products with ESG factors considered and in alignment with our ESG and sustainable investing framework.

You can access our list of ESG and sustainable investing funds by ticking the ‘Environmental, Social and Governance (ESG) or sustainable investments’ tick box when you search for unit trusts through the HSBC HK App or HSBC Online Banking.

At HSBC, we have 3 categories of ESG and sustainable investing products: HSBC Enhanced, HSBC Thematic and HSBC Purpose.

HSBC Enhanced: Investment solutions that seek stronger ESG performance, through either setting a minimum ESG score, favouring high performers, or excluding low performers in their investment approaches.

HSBC Thematic: Investment solutions that focus on sustainability themes or sectors such as decarbonisation, energy transition, healthcare or climate tech, for example, aligning with the themes of the UN Sustainable Development Goals.

HSBC Purpose: Investment solutions that seek to deliver intentional, positive and measurable outcome(s) and align to a predefined objective, measured using key performance indicators or established impact measurement frameworks.

Different organisations may employ various methodologies for classifying ESG and sustainable investing products. At HSBC, we apply a global product assessment framework to classify products (HSBC Enhanced, HSBC Thematic and HSBC Purpose) that we consider to be ‘ESG and sustainable investing'.

ESG and sustainable investing is an evolving area, and new regulations may come into effect, which may affect how an investment is categorised or labelled. An investment which is considered to fulfil ESG and sustainable investing criteria today may not meet those criteria at some point in the future. We will review and update the eligible investment product list from time to time.

Notes

The information is not and should not be construed as an offer to buy or sell any investment products, and should not be considered as investment advice. You should carefully consider whether any investment products are appropriate in view of your investment experience, objectives, financial resources and relevant circumstances.

Investment involves risk. Investors should not only base on this material alone to make investment decisions. Please refer to the offering documents of the respective funds for details, including product features, fees and charges, and risk factors. The price of units or shares and the income from them may go down as well as up and any past performance figures shown are not indicative of future performance. The information contained on this website is intended for Hong Kong residents only and should not be construed as a distribution, an offer to sell, or a solicitation to buy any securities in any jurisdiction where such activities would be unlawful under the laws of such jurisdiction, in particular the United States of America. Please refer to the unit trust disclaimer for further important details.

The contents of this page have not been reviewed by the Securities and Futures Commission.

Issued by the Hongkong and Shanghai Banking Corporation Limited

ESG and sustainable investing risk disclosure

In broad terms “ESG and sustainable investing” products include investment approaches or instruments which consider environmental, social, governance and/or other sustainability factors to varying degrees. Certain instruments we classify as sustainable may be in the process of changing to deliver sustainability outcomes. There is no guarantee that ESG and sustainable investing products will produce returns similar to those which don’t consider these factors. ESG and sustainable investing products may diverge from traditional market benchmarks. In addition, there is no standard definition of, or measurement criteria for, ESG and sustainable investing or the impact of ESG and sustainable investing products. ESG and sustainable investing and related impact measurement criteria are (a) highly subjective and (b) may vary significantly across and within sectors.
HSBC may rely on measurement criteria devised and reported by third-party providers or issuers. HSBC does not always conduct its own specific due diligence in relation to measurement criteria. There is no guarantee: (a) that the nature of the ESG/sustainability impact or measurement criteria of an investment will be aligned with any particular investor’s sustainability goals; or (b) that the stated level or target level of ESG/sustainability impact will be achieved. ESG and sustainable investing is an evolving area and new regulations are being developed which will affect how investments can be categorised or labelled. An investment which is considered to fulfil sustainable criteria today may not meet those criteria at some point in the future.
When we classify an investment product or service against our ESG and sustainable investing (SI) categories described in this document: Enhanced, Thematic or Purpose, this does not mean that all individual underlying holdings in the investment product or portfolio will meet the relevant SI criteria. As such, an SI classification does not mean that all underlying holdings in a fund or discretionary portfolio meet the relevant sustainable investment criteria. Similarly, where an equity or fixed income investment is classified under an Enhanced, Thematic or Purpose category, this does not mean that the underlying issuer’s activities are fully sustainable. Not all investments, portfolios or services are classifiable under our SI categories. This may be because there is insufficient information available or because a particular investment product does not meet HSBC’s SI classification criteria.

At HSBC, we finance a number of industries that significantly contribute to greenhouse gas emissions. We have a strategy to help our customers to reduce their emissions and to reduce our own. Find out more about our climate strategy.

The information contained in this material and the content have not been reviewed by the Securities and Futures Commission of Hong Kong or any regulatory authority in Hong Kong.

Investment involves risk. The price of products may move up or down. Losses may be incurred as well as profits made as a result of buying and selling products.

You should carefully consider whether any investment products or services mentioned herein are appropriate for you in view of your investment experience, objectives, financial resources and circumstances.

Making available to you any advertisements, marketing or promotional materials, market information or other information relating to a product or service shall not, by itself, constitute solicitation of the sale or recommendation of any product or service. If you wish to receive solicitation or recommendation from us, please contact us and, where relevant, go through our suitability assessment before transacting. The remuneration for sales staff is determined based on the staff's overall performance with reference to a wide range of factors, and is subject to review from time to time, for the purpose of encouraging the building of deep, long-lasting and mutually valuable relationships with customers. It is not determined solely on financial performance.

The information in this material does not constitute a solicitation or recommendation for making any deposit or an offer for the purchase or sale or investment in any products.

Issued by The Hongkong and Shanghai Banking Corporation Limited

ESG and Sustainable Investing

Important risk warning

What is ESG?

Sustainability Preferences Questionnaire

Are you interested in indicating your preferences when it comes to ESG and sustainable investing? Please log on to HSBC Online Banking and it will take you just a few minutes to complete the Sustainability Preferences Questionnaire.

Key features

Unlock opportunities

Build a resilient portfolio

Deliver potential capital growth

ESG and sustainable investing products

HSBC Enhanced

HSBC Thematic

HSBC Purpose

Understand more about our ESG and sustainable investing products

Unit trusts

Learn about the latest ESG Trend

Start your ESG and sustainable investing journey

HSBC investment account holders

Don't have an HSBC investment account?

Find out more

What is ESG and sustainable investing?

Why does ESG and sustainable investing matter?

Does ESG and sustainable investing provide or guarantee better performance?

What products are under the ESG and sustainable investing umbrella?

How can I find ESG and sustainable investing funds?

How will investment products be assessed as ESG and sustainable investing products at HSBC?

I hold a similar product at another institution but its ESG and sustainable investing classification is different from that of HSBC. Why is that the case?

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