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Investment Bank Pushes to Educate Its Execs on Sustainability Risk

16 March, 2005

Source: GreenBiz.com

NEW YORK, March 16, 2005 - UBS Investment Bank, the investment-banking arm of financial service giant UBS AG, has launched a program to integrate environmental and sustainability criteria into the bank's overall assessment of investment risk and opportunity.

UBS has hired Innovest Strategic Value Advisors to be the research provider for the companywide program. Innovest will make the research available through a Web site available to UBS divisions and executives around the world.

The new program is part of a broader effort by the UBS Investment Bank to drive an awareness of this new generation of investment risk -- and potential competitive advantage -- throughout the organization. There is a growing body of empirical evidence that companies with the ability to manage environmental and sustainability-driven risks and opportunities better than their industry peers tend to out-perform them financially as well. What is more, tightening environmental regulations, tougher corporate disclosure requirements, and growing concern from both institutional investors and non-governmental organizations (NGOs) seem
certain to increase the "sustainability risk/opportunity premium" even further over the next 12-18 months. 

"As a financial institution, UBS Investment Bank feels it is important to consider the downstream effect of our lending and investing activities on the environment, the rights of workers, communities and indigenous people.

The bank views this global site license as an important due diligence tool which will improve our ability to identify, analyze and manage environmental and social risk," states Joel Forbes, Global Head, Environmental Risk Management at UBS Investment Bank. 

"To the best of my knowledge, UBS's initiative is the most ambitious and comprehensive program of its kind in the world," said Dr. Matthew Kiernan, chief executive of Innovest. "Given the rapidly growing global importance of environmental, social, and governance issues to both corporate and institutional investors, this should give UBS a significant leg up on
their competitors.