BOC has launched China’s first ever socially responsible investment fund. The new Sustainable Growth Equity Fund is the first in China to apply socially responsible investment criteria, and an important milestone for socially responsible investment and sustainable development.
Wu Jun is BOC’s International Investment Manager, and Head of Sustainable Investment. He is also managing the fund, and says he will look beyond financial performance to include “sustainability of the business model, corporate governance, corporate strategy and the attitude towards social responsibility” as investment criteria. “It’s possible to promote positive and socially responsible corporate behaviour – as well as long term capital appreciation for investors”, Wu Jun says.
Socially responsible investment first gained profile in the USA and Europe in the early 1990’s and has since grown rapidly. With China’s first SRI fund now under way, the country’s vast population may at last begin to experience the benefits of clean, green and socially sustainable investment. Wu Jun says that he expects Chinese SRI to accelerate following the BOC lead. “There is a lot of support building here in China for investment that benefits society, as well as earning good commercial returns. We expect to see SRI become increasingly prevalent, and BOC will continue to lead the way with that”, Wu Jun said.
The benefits of SRI reaching a quarter of the world’s population will be felt well beyond China alone. This rapidly growing economy also has a growing appetitive for energy and other resources, posing a big challenge for sustainable development.
Robert Rubinstein, CEO of TBLI Consulting, calculates that China will reach the same consumption levels as the USA by 2031. “At current productivity levels China will need more than the entire world production of oil and coal. It’s difficult to see how that can be achieved at all, never mind achieving it sustainably”, Rubinstein says. SRI is essential, he believes, to drive as much of China’s growth as possible into more energy efficient and sustainable technologies and production. “Clean-tech and socially sustainable investment will be absolutely crucial for China’s future development”, he said.
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