Demand for ESG structured notes spells hedging pain for banks

As products linked to niche equity indexes grow in popularity, banks grapple with vol risk they pose

Environmental, social and governance, or ESG, principles have taken the investment world by storm in recent years. But now there is a storm brewing over the hedging of certain ethical investment products – a sizeable and growing subset of the $7 trillion structured product market.

As ESG equity indexes proliferate and investors become increasingly discerning, demand for structured notes linked to niche and bespoke sustainable indexes is rising. Hedging such products, though, is challenging as

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact or view our subscription options here:

You are currently unable to copy this content. Please contact to find out more.

Sorry, our subscription options are not loading right now

Please try again later. Get in touch with our customer services team if this issue persists.

New to View our subscription options

You need to sign in to use this feature. If you don’t have a account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here