Sustainable investing refers to types of investments that aim to generate long-term financial returns while advancing sustainable outcomes.
Here we look at:
Types of sustainable investing
Is sustainable investing right for you?
ESG and sustainable investing at HSBC
How you can invest sustainably with HSBC
Types of sustainable investing
There are many different approaches to investing sustainably. Examples include:
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Environmental, social, and governance (ESG) investing
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Ethical investing
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Impact investing
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Socially responsible investing (SRI)
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Values-based investing
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Conscious investing
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Green investing
There are differences between these approaches and their objectives.
Before you invest, take time to understand how an ESG and sustainable investment is measured and whether it aligns with your objectives and financial goals.
There's currently no standard definition of 'ESG and sustainable investing' approved by regulators across the industry in the UK. Because other providers may define it differently to the way we do, you may find it hard to compare investments on a like-for-like basis.
Is sustainable investing right for you?
Some investors put their money into sustainable investments to help them meet their financial objectives.
Environmental, social, and governmental (ESG) issues can impact share prices – both positively and negatively. Taking these factors into account when investing could increase the resilience of your investments.
However, please note:
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The benchmarks for ESG and sustainable investments may be different from those of regular investments
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An ESG and sustainable portfolio may produce different returns to those that don’t consider these factors
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There’s no guarantee investing in an ESG and sustainable portfolio will match your personal ESG and sustainability ambition
The value of any investment can go up and down, and you may not get back what you invest. All investments should be seen as a medium to long-term commitment, meaning you should be prepared to invest for at least 5 years.
ESG and sustainable investing at HSBC
Our fund managers, HSBC Global Asset Management (UK) Limited, assess the sustainability of the companies they invest in by scoring them against 3 sets of criteria: environmental, social, and governance factors (known as 'ESG').
| ESG issue | Example | Factors include: |
|---|---|---|
| Environmental | What impact does the company have on the environment? | Climate change Air and water pollution Waste management Energy efficiency Water shortage |
| Social | How is the company supporting its employees, clients and communities? | Human rights Consumer privacy Gender equality Data security Health and safety |
| Governance | How is the company governed or managed? | Board structure Company ownership Financial reporting Business ethics and culture Executive remuneration |
| ESG issue | Environmental | Environmental |
|---|---|---|
| Example | What impact does the company have on the environment? | What impact does the company have on the environment? |
| Factors include: | Climate change Air and water pollution Waste management Energy efficiency Water shortage | Climate change Air and water pollution Waste management Energy efficiency Water shortage |
| ESG issue | Social | Social |
| Example | How is the company supporting its employees, clients and communities? | How is the company supporting its employees, clients and communities? |
| Factors include: | Human rights Consumer privacy Gender equality Data security Health and safety | Human rights Consumer privacy Gender equality Data security Health and safety |
| ESG issue | Governance | Governance |
| Example | How is the company governed or managed? | How is the company governed or managed? |
| Factors include: | Board structure Company ownership Financial reporting Business ethics and culture Executive remuneration | Board structure Company ownership Financial reporting Business ethics and culture Executive remuneration |
ESG and sustainability characteristics are one of many considerations for our fund managers when deciding whether to invest in a fund. They also consider the investment’s expected financial performance and the current economic environment.
Today, 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. For more information visit www.hsbc.com/sustainability.
How you can invest sustainably with HSBC
Choose a ready-made sustainable portfolio
Our range of sustainable investment portfolios contain a mix of global investments.
Each portfolio has a different level of risk and potential reward and is managed on your behalf by our investment experts. Just choose your preferred level of risk, and we’ll take care of the rest.
HSBC Global Asset Management uses internal research and data from third parties to ensure at least 70% of the net asset value of the portfolios are invested across assets they consider to be sustainable. However, they can't certify third-party ESG measurement criteria themselves. The portfolios also contain some assets they don't define as sustainable.
You can see the ESG scores of each portfolio as well as their carbon footprint in the portfolio factsheet PDF.
Build your own portfolio
Want to make your own investment decisions? Our online fund platform (Global Investment Centre) offers other funds with different types of sustainable strategies – from HSBC and other leading fund managers.
Take all the time you need to research what’s there before deciding on the right approach for you.
To invest with us, you need to have an HSBC current account or savings account. Eligibility criteria and charges apply.
This article was last updated:13/02/2024, 09:10
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