ESG Investing
in Fixed Income

PIMCO is committed to the integration of Environmental, Social and Governance (ESG) factors
in our investment process and developing innovative ESG solutions for clients.

Latest ESG Insights

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PIMCO ESG Platform

In 2017 PIMCO launched a range of dedicated fixed income ESG strategies combining ESG-focused portfolio construction with active engagement and transparent reporting.

Targeting Performance and Positive Change

Exclude

Restrict investment in issuers fundamentally misaligned with sustainability practices

Examples of exclusions

  • Controversial weapons
  • Tobacco
  • Pornography
  • Coal

Evaluate

Emphasize best-in-class ESG issuers and prime ESG engagement candidates in portfolio construction

Attributes of best-in-class issuers

  • Good environmental practices
  • Strong corporate governance
  • Industry-leading social policies

Engage

Engage collaboratively with issuers to change ESG-related business practices

Sample engagement questions

  • Are you developing a framework for climate risk reporting?
  • What is your policy on parental leave?
  • Do you have a culture and conduct committee?

Engagement & Impact

Within PIMCO’s dedicated ESG strategies, we focus on identifying and engaging with companies that have the ability and willingness to improve ESG-related business practices. We believe that successful engagement has the potential to lower credit risk, unlock value and influence change.

IN 2018 WE CONTACTED 147 CORPORATE ISSUERS THROUGH OUR ESG ENGAGEMENT PROGRAM

Overall response rate

 

Engagement activity by region

 

Engagement activity by topic

 
SOURCE: PIMCO as of 31 December 2018. In 2018 PIMCO contacted 147 corporate issuers and received detailed responses from 119 companies. Charts based on the percentage of companies contacted by region and the percentage of engagement questions by topic..

Disclosures

A word about risk: All investments contain risk and may lose value. There is no guarantee that socially responsible investing (SRI) products or strategies will produce returns similar to traditional investments. Investing in the bond market is subject to risks, including market, interest rate, issuer, credit, inflation risk, and liquidity risk. The value of most bonds and bond strategies are impacted by changes in interest rates. Bonds and bond strategies with longer durations tend to be more sensitive and volatile than those with shorter durations; bond prices generally fall as interest rates rise, and the current low interest rate environment increases this risk. Current reductions in bond counterparty capacity may contribute to decreased market liquidity and increased price volatility. Bond investments may be worth more or less than the original cost when redeemed. Derivatives may involve certain costs and risks such as liquidity, interest rate, market, credit, management and the risk that a position could not be closed when most advantageous. Investing in derivatives could lose more than the amount invested.

This material has been distributed for informational purposes only and should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. No part of this material may be reproduced in any form, or referred to in any other publication, without express written permission.