THE DEVELOPMENT OF ESG REQUIREMENTS TO PENSION ASSETS INVESTMENTS

Resumo

Objective: The article is devoted to the topical issue of the development of investment in ESG assets of financial institutions in emerging markets on the example of the Russian pension market. The purpose of the study is to identify investment opportunities in sustainable assets of Russian pension assets formed within the framework of the voluntary pension system. Specific research objective is to investigate the performance of pension reserves’ investment portfolio after the expected liberalization of the investment policy of Russian non-state pension funds after the upcoming decision on the transfer of pension savings to a voluntary system. Methods: Methodologies employed included the investment performance investigation on the basis of created pension reserves’ index, that, on the one hand, would assume all the Russian market restrictions on the maximum investments’ shares, and on the other hand, would include expanded investment opportunities through the integration of ESG assets. Results: The long-term trend of lowering rates has long been putting pressure on pension systems around the world and this forces the regulator to expand the list of debt instruments at the expense of riskier and more profitable ones. The rationale of sustainable assets’ inclusion in the portfolio of pension assets concerns the opportunity to increase the attractiveness of non-state pension provision for millennials and become competitive when sold through financial marketplaces. Conclusion: The contribution of the paper is to develop the socially important topic devoted to the increase the performance efficiency of non-state pension provision in the emerging markets. Personal contribution of the authors was that, considering the existing legislative restrictions, on the basis of the developed index of pension reserves, there were formulated the proposals on the pension investments structure.