UBS Chairman: The niche market for 'impact investing' could be huge — but it needs derivatives

pulse

April 6, 2018 10:16 AM

The market for so-called impact investing needs derivatives, UBS Chairman Axel Weber said.

UBS Chairman Axel Weber sees a growing market for so-called impact investing, which focuses on projects that are good for the environment or society as a whole.
Derivatives such as bond indices are needed to take the market mainstream, Weber said, to allow investors to hedge risk.

LONDON — The market for so-called impact investing, which funds projects beneficial to the environment and wider society, has a problem.

There's no global agreement on how to measure the impact, according to UBS Chairman Axel Weber.

Only when the proper standards are in place, and markets for derivatives such as bond indices are developed, can it truly take off.

"At UBS we see a big demand from our clients for sustainable investment," Weber told Business Insider in an interview earlier this year. "Many of our wealthy clients are active in philanthropy or run charities, and through these charitable engagements they're used to looking at impact."

The market for green bonds, which are securities aimed at

In 2016, the world's largest asset manager BlackRock said that c

But at the moment, the industry lacks the solid global standards to take those opportunities to a larger pool of investors.

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