June 2022 / ESG
ESG Integration in Action—Circular Economies
How a circular model could support economic and population growth
Executive Summary
- Investors can play a role in helping to close the food gap, but we also must ensure that our investment is being deployed sustainably.
- Plastics have come to epitomize the problems of the end-to-end (or linear) economy.
- The circular economy underpins a transition to renewable energy and materials.
The vast majority of economic activities are built on a linear model, where raw materials are taken from the earth, used to make products, and eventually discarded. Economic and global population growth have created impacts that mean this linear model cannot be sustained. If global economies are to prosper and support the world’s burgeoning population, a shift to a circular economy is needed.
The circular economy is based on three principles— eliminating waste and pollution, circulating products and materials, and regenerating nature. It is underpinned by a transition to renewable energy and materials, helping to decouple economic activity from the consumption of finite resources.
We demonstrate how our in-house research and stewardship activities evaluate three principal themes within the circular economy:
Read the full paper here.
IMPORTANT INFORMATION
This material is being furnished for general informational and/or marketing purposes only. The material does not constitute or undertake to give advice of any nature, including fiduciary investment advice, nor is it intended to serve as the primary basis for an investment decision. Prospective investors are recommended to seek independent legal, financial and tax advice before making any investment decision. T. Rowe Price group of companies including T. Rowe Price Associates, Inc. and/or its affiliates receive revenue from T. Rowe Price investment products and services. Past performance is not a reliable indicator of future performance. The value of an investment and any income from it can go down as well as up. Investors may get back less than the amount invested.
The material does not constitute a distribution, an offer, an invitation, a personal or general recommendation or solicitation to sell or buy any securities in any jurisdiction or to conduct any particular investment activity. The material has not been reviewed by any regulatory authority in any jurisdiction.
Information and opinions presented have been obtained or derived from sources believed to be reliable and current; however, we cannot guarantee the sources’ accuracy or completeness. There is no guarantee that any forecasts made will come to pass. The views contained herein are as of the date written and are subject to change without notice; these views may differ from those of other T. Rowe Price group companies and/or associates. Under no circumstances should the material, in whole or in part, be copied or redistributed without consent from T. Rowe Price.
The material is not intended for use by persons in jurisdictions which prohibit or restrict the distribution of the material and in certain countries the material is provided upon specific request. It is not intended for distribution to retail investors in any jurisdiction.
Maria Elena Drew is a director of research for Responsible Investing at T. Rowe Price. In her current role she leads the Responsible Investing team, which serves as specialists for incorporating environmental and social considerations into the firm’s research process. Maria is on the Investment Advisory Committees of the Emerging Europe Equity, Emerging Markets Discovery Equity, Global Growth Equity, Global Value Equity, International Value Equity, Latin American Equity, and Asia ex-Japan Equity Strategies. In addition, she is a vice president of T. Rowe Price Group, Inc., T. Rowe Price International Ltd, and T. Rowe Price Global Funds.
Donna Anderson is the global head of Corporate Governance. Donna leads the firm’s proxy voting and engagement efforts and serves as a specialist for incorporating governance considerations into the firm’s investment research process. She is cochair of the ESG Committee , a member of the Valuation Committee, and a director of the T. Rowe Price Trust Company. She is a vice president of T. Rowe Price Group, Inc.
