A day in the life... An ESG Investment Analyst

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5 months ago by Jessica Brown

A day in the life... An ESG Investment Analyst

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Responsible investment approaches investing in a way that incorporates environmental, social and governance (ESG) factors. This is done to manage risk and create sustainable returns. ESG is a booming area within the investment space. Globally, over $22 trillion of assets were managed under responsible investment strategies in 2016, which is up 25% from two years previously, according to the Global Sustainable Investment Alliance. This is one statistic of many, showing how much ESG investment is growing. 

1. What is the starting salary range for this role? 

A typical starting salary for an ESG Analyst role might look like £35,000, but this depends on the company size and various other factors. 

2. How do you enter this field? 

It’s possible to enter into this role at entry level, although often you might need a year or so within the investment space first. It might also be an idea to obtain an undergraduate degree in a relevant field such as Geography, Environmental Science, Finance, Sustainable-oriented degrees. 

3. What does a typical day in the office look like? 

The same role can vary quite a bit from company to company. Typically, an ESG Analyst carries out research using a variety of collected information, both public and private. For example a company's annual reports, government and NGO public policy papers, and market data from Bloomberg, as well as interviews/questionnaires/surveys. 

An ESG Analyst would then write reports on their findings, considering how a certain company’s ESG impact would be affected if they were to invest, if the investor’s risk capabilities are in line with the ESG risks, and if any risks can be avoided by working with the company to improve their ESG impact. 

An Analyst may also monitor ESG issues after investing in a company. They might contribute to reports of performance. They might also improve a company’s ESG impact by working with them directly. 

The work of an ESG Analyst will often vary depending on the context of the role; an ESG Analyst may spend more time on primary research if working for a market research company, compared to someone working for a sustainability NGO, focussing more on the analysis of ESG policies of other entities. 

4. What is the most challenging aspect of the job? 

As with any job, the most challenging aspect of a person’s role depends on the individual. Perhaps the most challenging aspect is the fact that ESG considerations are only recently gaining considerable traction. As such, there’s some uncertainty around the area, and critics of the practice because of this. These critics, opposing the value of your work, could be quite challenging. 

5. What is the most rewarding aspect of the job? 

The very premise of ESG Investing is about being responsible with investment decisions. There are a great many examples of ESG factors, including: Environmental: climate change, resource depletion, waste and pollution. Social: working conditions, including slavery and child labour, employee relations and diversity Governance: executive pay, bribery and corruption, political lobbying and donations. 

If you’re passionate about sustainability, then these are incredibly important issues to consider. It’s rewarding to know that your work encourages companies to act more responsibly if they want investment. 

6. What skills are the most important to perform well in this kind of role? 

To perform well as an ESG Analyst, you’ll need to have strong analytical skills to screen and analyse data and to carry out research. You might also need strong numerical skills to work with statistics and data evaluation. You will also need presentation, communication, and negotiating skills, in order to engage well with stakeholders. 

7. What advice would you give to someone looking to apply for a similar role? 

One word: Passion. The employers that I’ve spoken to all want to see someone that is passionate and enthusiastic about responsible investing – whether this is demonstrated through previous work experience, through your degree, or through any projects you’ve worked on, it’s important to show that you really care about corporate responsibility. If you’re interested in finance, as well as enthusiastic about making companies become more sustainable, this is a great career path to follow. 

NB: This information was gathered from speaking to a number of ESG Analysts and has brought together their thoughts, it is not indicative of every single ESG Analyst role.