Institutional Investor (July 3)
“In the often dogmatic debate over whether using environmental, social, and governance factors helps or hurts investment returns, neither side is going to cheer the findings of a recent Preqin report: ESG didn’t matter.” The analysis of 11,000 funds found “average performance of ESG funds was 13.5 percent, compared with 15.0 percent for all private capital funds,” a difference that is not statistically significant. Moreover, “the results were similar even after accounting for different asset classes.”
Tags: 13.5%, 15.0%, Asset classes, Debate, Dogmatic, ESG funds, Helps, Hurts, Investment returns, Performance, Preqin, Private capital
Bloomberg (February 14)
“Japan’s largest money managers appear to have come to a consensus about where to allocate their sustainable investment portfolios: anywhere but Japan. The country’s four largest ESG funds have put at least 95% of their net assets in foreign stocks… devoting only a small fraction of their 1.4 trillion yen ($12.1 billion) to domestic holdings.”
Tags: Consensus, Domestic holdings, ESG funds, Foreign stocks, Investment portfolios, Japan, Money managers, Net assets, Sustainable
Responsible Investor (June 9)
“Only in finance can a product lose 24% of its value and be celebrated as success. Since traditional benchmarks have lost more than ESG funds since the beginning of the year, ESG is feted by some as a success, a ‘refuge’.” Kudos, however, are not in order. “The rude fact is that, on the whole, ESG risk management frameworks did not prepare us for the inevitability of the pandemic. They did not help investors and banks anticipate the crisis, nor how to navigate it. The pandemic is a failure of mainstream risk management frameworks. Sadly, it is also a failure of ESG risk management frameworks.”
Tags: Banks, Benchmarks, Crisis, ESG funds, Finance, Frameworks, Investors, Pandemic, Refuge, Risk management, Success, Value
