SRI Asia

Myth #1: Asian SRI Stocks will always under-perform conventional stock

FALSE: 

The OWW Asian SRI Index Series provides plenty of evidence that SRI in Asia delivers returns that are at least as good as and often better than conventional investments.

Since its launch in December 2006 to mid-February 2007, the OWW ResponsibilopityTM Malaysian SRI index has delivered 17.6% price returns compared to 15.1% on the KL Composite Index (KLCI).

The OWW ResponsibilityTM Singapore Index launched in March 2007, produced historical price returns of 35.37% since its base of 1st September 2006 compared to 32.87% on the Straits Times Index (STI).

Myth #2: SRI in Asia is just another fad that will come and go like other fads

FALSE:

The SRI movement around the world has grown considerably over the last 20 years and now has established assets under management worth more than US$4 trillion in more than 1,000 separate products.

SRI asset mangers tend to prefer more stable holdings that look for long-term performance – they are in this for the long-term and are looking to diversify into Asian markets

Many Asian governments are introducing CSR and SRI requirements such as those announced by Prime Minister Abdullah Badawi in the 2007 Malaysian Budget.

These are aimed to inculcate CSR into the business community and are supported by tax incentives and government funds (from pension schemes and investment agencies) which underpin CSR and SRI in Asia.

Myth #3: SRI in Asia will only ever be a niche – it will never be Mainstream 

FALSE:

Although there is only a small number of specialist Asian SRI Funds at the moment, it is perfectly possible to develop a socially responsible investment policy (SRI) gradually and on a customized basis.

This allows companies to turn their conventional, mainstream funds into SRI Funds de facto

Many funds choose to:

• Invest in SRI over part of their portfolio and gradually extend it to cover all of their holdings

• Use passive management schemes that track Asian SRI Indices and keep costs low

• Use active management based on their own choices, often following specific themes