Climate change has made ESG a force in investing
But the figures behind ESG rating systems are dismal
“LABELLING BASED on incomplete information, public shaming, and shunning wrapped in moral rhetoric,” said Hester Peirce, a straight-talking commissioner at America’s main financial regulator, the Securities and Exchange Commission, in June. She was taking aim at the scoring systems that purport to assess firms’ performance based on environmental, social and governance (ESG) factors. Yet love them or hate them, ESG scores are becoming ever more important in the world of investing and capital markets. At least $3trn of institutional assets now track ESG scores, and the share is rising quickly.
This article appeared in the Finance & economics section of the print edition under the headline “Poor scores”
Finance & economics December 7th 2019
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From the December 7th 2019 edition
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