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ECB looking at ways of increasing ESG in investment strategy

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ECB looking at ways of increasing ESG in investment strategy

The European Central Bank is looking at ways of incorporating environmental, social and governance principles into its own investments, President Mario Draghi said in a letter to members of the European Parliament.

He said the ECB's pension funds invest in a wide range of asset classes, allowing the bank to incorporate ESG into its investment strategy.

"Further ways of incorporating ESG principles into the management of other ECB euro-denominated non-monetary policy portfolios are currently being investigated," he said in the letter in response to questions by MEPs Paul Tang, Neena Gill and Jonás Fernández about the bank's ESG strategies.

He said some central banks within the 19-member eurozone were looking at or had introduced ways of applying responsible investment to their nonmonetary policy portfolio. For example, the French central bank is working on ways of incorporating ESG considerations into its own investment strategy and will apply a charter on ESG investing to its own funds and its retirement plans end-2018.

Draghi added that the ECB had acquired government-issued green bonds as part of its quantitative easing program, as well as those issued by international institutions such as the European Investment Bank, one of the world's largest issuers of green bonds.