S. Korea’s c.bank reinforces ESG attention in the management of foreign currency assets
SEOUL, Sept.28 (Reuters) – South Korea’s central bank said on Tuesday it would put more emphasis on environmental, social and governance (ESG) issues in managing its foreign currency assets and prepare guidelines to be applied to these assets in the future.
To meet the growing demand for socially responsible investment, the bank will “upgrade” its asset management strategy from the current stage of investing in ESG products to applying ESG elements to all active assets. foreign currency, the Bank of Korea (BOK) said in a statement. .
The BOK invested a total of $ 7.12 billion of its foreign currency assets in ESG-related stocks and bonds at the end of June, with around $ 1.22 billion in stocks and $ 5.90 billion. dollars in bonds. This compares to the $ 5.45 billion invested by the end of 2020.
The central bank will continue to increase its investments in bonds and ESG-linked stocks, he added.
The bank plans to apply negative screening – a policy that excludes investments in companies or sectors that do not meet specific ESG criteria – using the MSCI ESG filtered indices, while the BOK may also review the implementation of its own negative filtering system within two to three years.
The central bank also said it expects expanding ESG investments to increase the rate of return on its currency assets in the future.
Reporting by Joori Roh; Editing by Rashmi Aich
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