ESG Investing

This article examines how corporate ESG performance affects bank lending decisions in Taiwan. Using TEJ’s TESG Ratings, the study finds that companies with stronger ESG performance generally receive more favorable lending conditions, including lower loan spreads, larger loan amounts, longer maturities, and a lower likelihood of collateral requirements. The findings also highlight the importance of balancing ESG initiatives with financial performance, as excessively high or low ESG performance may lead to less favorable lending terms.

As America continues to maintain a high-interest rate, the borrowing cost for companies still remains at a peak. However, compared to other bonds, bonds related to ESG enjoy a lower yield, but seldom do we see small or startup companies issue green bonds. This is because issuing green bonds requires the funds only to be used on certain ESG projects, which is normally not the primary goal for small and startup companies. Hence, a new type of bond, Sustainability-Linked Bonds, is created. In this article, we will briefly introduce the concept and principle of Sustainability-Linked Bonds.

The previous article mentioned the basic types of ESG bonds, and we believe you have a basic understanding of these types of bonds. Next, we will introduce specific types of ESG bonds, and briefly introduce you to a few representative countries that are currently promoting sustainable finance policies and ESG bond market development.

ESG bonds are issued in the same way as regular bonds, but the difference lies in the use of the funds, which is the most important reason to differentiate ESG bonds from regular bonds.

For advocates of negative screening, the most crucial question is how to screen for good companies. Can the selected companies not only align with personal values but also meet returns?

In the previous article, we introduced TESG’s scoring mechanism in detail and its rating ratio among popular ETFs in China. This article will teach readers how to further use the ESG rating provided by TESG, and use Python to construct a concurrent An investment portfolio with sustainable operations and financial growth potential.

In recent years, various asset management companies have launched ESG-related ETFs, such as the pioneering Fubon Corporate Governance ETF (00692), which focuses on the top 100 companies in Taiwan in terms of corporate governance, and the Cathay Sustainable High Dividend ETF (00878), which combines high dividend yields with sustainability criteria. The common thread among these ESG ETFs is their tracking of ESG indices introduced by domestic and international index providers. While each ESG ETF specializes in different areas, they all rely on ESG screening criteria, emphasizing sustainable business practices among their constituent stocks, allowing investors to invest in assets that balance environmental sustainability and robust growth potential.

Observe the relation between employee turnover rate and stocks return Highlights Preface In recent years, there’s an investment called ESG investing, meaning when investing, the firm’s financial performance is not the only thing to be considered. Instead, its influence over environment and society and its corporate governance should be stressed as well. There are no […]