ESG in sovereign bonds: treading the thin line between engagement and politics

Monitoring environmental, social, and governance (ESG) performance isn't always easy, especially when gauging the "G", or governance, of authoritarian governments where transparency is in short supply. In places where investigating the ESG benchmarks of a government bond, for instance, can be seen as political interference, investors need to be circumspect. Asset owners are encouraged to work more closely with fund managers to define clearly what ESG factors they want to see whe…