Articles

One of the core questions surrounding SRI and ESG investing involves the trade-offs of short-term investment performance versus direct or indirect contribution to an adverse long-term societal impact.

The rise of sustainable, responsible and impact investing strategies, has led many firms and their investors to seriously question the importance and prominence of gender diversity in leadership positions. Although the financial services sector is still very much a male-dominated industry, considerations regarding environmental, social and governance (ESG) issues have provided an avenue to bring more women to the table.

Based on emerging societal norms, it would make sense to put equality for women at the forefront of investing, however it goes much deeper than a societal nicety; organizations that prioritize the rights and equality of women make their own organization stronger in general. Those companies that rank higher from an ESG perspective for embracing the gender lens for investments also help to optimize the returns on their investments as well.

In this column for Equities.com, I discuss 10 major strengths and 10 major limitations of ESG ratings. No matter what the future holds for the acronym ESG, it will still be essential for those in financial services to fully understand the sustainability, ethical practices, and long-term viability of companies through ESG data, as it helps to find potentially fatal flaws that traditional financial analysis previously failed to diagnose.

Terminology and taxonomy in finance matters, so it would behoove one to ensure a proper understanding of a concept before looking to ban it or punish those who use it. While I could waste my day demonstrating how every reference to ESG throughout Project 2025 is incorrect, illogical, misconstrued or just plain false, I’ve decided instead to provide just a few practical takeaways that anyone can use to set the record straight on ESG in all industries. I would be most grateful if you shared the awesome hard work of the team at Equities.com and please help to stop misinformation about ESG and sustainable investing from permeating into our industry and beyond.

My latest take in The ESG Factor Magazine on how better to approach the "S" in ESG. Subjectivity for metrics comes into play when the social issue is one that may be considered of importance to some, but not all investors, and on the surface is worth knowing but may not result in any meaningful financial impact to the stock.

Happy to contribute this piece to The ESG Factor Magazine for the November 2023 edition -- Analyzing the Significance of Severe ESG Corporate Controversies. It was also a fantastic opportunity to showcase some of the broader data we can compile on Ethos ESG (now part of ACA Group) to examine governance trends among corporations in difference industries.

Without a doubt, the practice of using ESG screening practices for investments has become mainstream across the globe. While some advisors have been engaged in sustainable investing practices for a long time, others are discovering how to incorporate these strategies for their clients for the first time. Such strong interest in ESG is very encouraging, however at the same time it can be challenging to maintain the integrity and mission of these investments.

This notion of military spending being necessary to revive failing economies is merely a residual confirmation bias that began in World War II and has since influenced much of U.S. spending and economic policies to this day.