2017责任投资指南（英文版）-2mb

Summary of Santiago Exchange's Guide to Responsible Investment

Core Content

This document outlines the concept, objectives, and benefits of Responsible Investment (RI) in the context of capital markets, with a focus on Chile and Latin America. It is developed by Santiago Exchange in collaboration with EY (formerly Ernst & Young) and is part of Santiago Exchange's commitment to promoting sustainability in financial markets. The guide aims to educate investors, companies, and market participants on the integration of Environmental, Social, and Governance (ESG) factors into investment practices and decision-making.

Main Objectives of the Guide

1. Understand Responsible Investment
   Introduce the concept and definition of RI based on global consensus, emphasizing its role in ensuring long-term, sustainable returns.

2. Identify ESG Risks and Opportunities
   Show how traditional financial analysis neglects ESG factors, which can have both positive and negative impacts on investment performance.

3. Determine Strategies and Steps to Invest Responsibly
   Provide readers with a series of perspectives and actions to consider when incorporating ESG variables into investment decisions.

4. Explore the Potential of Responsible Investment
   Demystify prejudices about RI and demonstrate that it can provide economic returns with lower risk levels and a long-term outlook.

Key Concepts and Definitions

Definition of Responsible Investment

Responsible Investment is an investment approach that explicitly acknowledges the relevance of ESG factors to the investor and the health and long-term stability of the market. It recognizes that sustainable returns depend on the stability and proper functioning of social, environmental, and economic systems.

Differences from Conventional Investment

• Long-term Focus: RI prioritizes long-term, sustainable returns over short-term gains.
• Contextual Awareness: It requires investors to pay attention to the broader context, including economic, environmental, and societal systems.

Roles of Key Market Participants

Investors

• Are responsible for managing ESG risks and opportunities.
• Fulfill their fiduciary duty by acting in the best interest of their clients.
• Incorporate ESG factors into investment decisions to enhance long-term returns and contribute to sustainable economic development.

Issuers

• Are beginning to integrate ESG issues into their strategic management.
• Recognize the increasing societal expectations and the need to balance economic, social, and environmental results.

Exchanges

• Play a fundamental role in building sustainable capital markets.
• Set standards, promote best practices, and enhance transparency and corporate governance.
• Santiago Exchange is actively involved in global initiatives such as the United Nations Sustainable Stock Exchanges (SSE) and the World Federation of Exchanges Sustainable Working Group (SWG).

Rating Agencies and External Assurance Firms

• Specialized in assessing ESG performance of companies.
• Provide credibility and transparency by confirming sustainability disclosures.
• Examples include RobecoSAM, which is involved in the DJSI Chile index.

Benefits of Responsible Investment

1. Maximizing Risk-Adjusted Returns
   ESG integration allows investors to better understand company risks and opportunities, leading to improved decision-making and long-term returns.

2. Strengthening the Fiduciary Role of Institutional Investors
   Incorporating ESG factors aligns investment practices with fiduciary obligations and promotes sustainable capital allocation.

3. Contributing to Sustainable Economic Development
   RI supports the achievement of the United Nations' 2030 Agenda for Sustainable Development, including 17 Sustainable Development Goals (SDGs) such as poverty eradication, climate action, and gender equality.

Global and Regional Context

Global Context

• Responsible Investment is a growing trend, with ESG-integrated portfolios increasing by over 60% between 2012 and 2014.
• Globally, ESG investment accounts for 30.2% of all professionally managed investments as of 2014.
• ESG factors are increasingly being integrated into financial analysis and investment research.

International Initiatives

• Sustainable Stock Exchanges (SSE): A UN-led initiative promoting sustainability in capital markets through collaboration with exchanges, investors, and regulators.
• Principles for Responsible Investment (PRI): Six voluntary principles developed by the UN in 2006, aimed at guiding investors and companies in integrating ESG factors into their practices.
• Sustainable Investment Forum (SIF): A global network promoting responsible investment and sustainable financing across multiple regions.

Responsible Investment in Latin America

• ESG integration is becoming more prominent as investors seek to mitigate "extra-financial" risks.
• Santiago Exchange has been a key player in promoting RI in the region, including launching the first local Sustainability Index (DJSI Chile) and developing a Sustainability Reporting Guide.

Responsible Investment in Chile

• Dow Jones Sustainability Chile Index (DJSI Chile): Chile's first sustainability index, developed to encourage ESG integration in the local market.
• New Regulatory Developments: Santiago Exchange is actively working to introduce new regulations that promote transparency and responsible investment practices.

Steps to Invest Responsibly

The guide outlines the following steps for investors to incorporate RI into their practices:

1. Understand the concept of responsible investment and its relevance to long-term returns.
2. Identify ESG risks and opportunities associated with potential investments.
3. Determine strategies for integrating ESG factors into investment decisions.
4. Access ESG information and use it to make informed decisions.
5. Engage in active ownership and dialogue with companies on ESG issues.

Conclusion

Santiago Exchange's Guide to Responsible Investment serves as a valuable resource for investors, companies, and market participants, promoting the integration of ESG factors into investment practices. It highlights the growing importance of RI in today's financial landscape and underscores the role of exchanges, rating agencies, and regulatory bodies in fostering sustainable markets. The guide also supports the broader goals of the UN-supported SSE and PRI initiatives, aiming to drive transparency, long-term value creation, and positive societal impact.