ESG: The Impact of Governance on Emerging Market External Debt Returns

In this paper, I shed light on ESG investing by focusing on governance and examining its relationship with risk premiums and returns in emerging market hard currency bonds using the World Bank’s Worldwide Governance Indicators (WGIs)

Authors

Affiliation

Eric Baurmeister

Morgan Stanley Investment Management

Teal Emery

Morgan Stanley Investment Management

Image Credit: Morgan Stanley Investment Management

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Abstract

Interest in environmental, social and governance (ESG) factors in investing has grown dramatically. Google searches for “ESG investing” have grown approximately tenfold in the last five years, and are nearly double the level of mid 2017. Ethical considerations and investment performance are two of the main motivating factors behind the rise in investor interest in ESG. The definition of ESG when applied to emerging market sovereign debt is still evolving and has yet to settle into a commonly defined approach. In this paper, we attempt to shed light on ESG investing by focusing on governance and examining its relationship with risk premiums and returns in emerging market external debt markets.

Citation Information

Citation

BibTeX citation:

@report{baurmeister2018,
  author = {Baurmeister, Eric and Emery, Teal},
  publisher = {Morgan Stanley Investment Management},
  title = {ESG: {The} {Impact} of {Governance} on {Emerging} {Market}
    {External} {Debt} {Returns}},
  date = {2018-11-01},
  url = {https://tealemery.com//publications/2018-11-governance-external-debt},
  langid = {en}
}

For attribution, please cite this work as:

Baurmeister, Eric, and Teal Emery. 2018. “ESG: The Impact of Governance on Emerging Market External Debt Returns.” Morgan Stanley Investment Management. https://tealemery.com//publications/2018-11-governance-external-debt.