Displaying items by tag: esg

According to a Bloomberg News survey of terminal and Bloomberg.com readers, sixty-five percent of the respondents expect ESG funds to trail the broader market in 2023. Out of the 691 survey respondents, 264 expect ESG funds to “slightly underperform,” while 184 are predicting they’ll “significantly underperform.” Of those 691 respondents, 235 identified themselves as being directly involved in ESG investing, and of this group, a little more than half said they expect the funds to “slightly” or “significantly” underperform. Fionna Ross of Edinburgh-based fund manager Abrdn Plc told Bloomberg, “Given the challenges of 2022, there will be some recovery next year, but it will remain mixed” because of inflation and other overhanging economic hurdles." While data shows that the average equity fund adhering to ESG factors lost slightly less money this year than products that track traditional broader market indexes such as the S&P 500, ESG funds have outperformed over a longer period. According to researchers at Morningstar, about 56% of U.S. sustainable funds beat rival category groups in the three-year period that ended on Sept. 30th.

Finsum:Based on the results of a recent Bloomberg survey, 65% of respondents believe that ESG funds will underperform the broader market in 2023. 

While politics have made ESG a controversial topic recently, there’s no denying the fact that its popularity is still soaring. That was made abundantly clear with the release of the Index Industry Association’s (IIA) sixth annual global benchmark survey, showing a surge in ESG benchmarks worldwide. According to the survey, the total number of indexes climbed internationally by 4.43% over the prior year, with ESG indexes worldwide increasing by 55%. However, the bigger news was that fixed-income ESG indexes surpassed equity ESG indexes for the first time. In fact, fixed-income ESG indexes increased by an unprecedented 95.8%. This breaks the previous record of 61.09% last year. While equity ESG index growth was slower, it still grew at a high rate of 24.15 percent. Muni indexes had the strongest year for non-ESG fixed income, rising 10.86%. Rick Redding, IIA’s CEO, said the following concerning the survey: “The index industry continues to meet the needs of the marketplace by creating innovative solutions. Highlighted again this year by record growth in ESG, index providers are empowering investors with the ability to define, track and better understand an ever-broadening range of financial markets, sectors, investment styles, and asset classes.”

Finsum:A recent index survey revealed that fixed-income ESG indexes have surpassed equity ESG indexes for the first time.

According to a new research survey by Stanford University, investor support for ESG and their willingness to potentially lose money on ESG causes varied by age, wealth, and specific ESG issues. The survey found that investors 58 years old and over were the least likely to support ESG objectives in general, while investors between the ages of 18 and 41 were the most likely to put their savings at risk to support various ESG initiatives. More than one-third of younger investors said they would be willing to lose 11% to 15% of their retirement if that meant encouraging companies to have gender and racial diversity mirroring the general population. Only 3% of the older investors said they would forfeit the same amount for those goals. Two-thirds of older investors said they were unwilling to lose any money to support diversity. Stanford also found that wealthier young investors were the biggest ESG champions. Young investors with at least $250,000 would be willing to lose about 14% of their retirement savings, while young investors with savings less than $50,000 said they would only be willing to lose 6%. In terms of specific ESG issues, the survey found that investors cared more about environmental issues than social issues and governance.

Finsum:A recent ESG survey conducted by Stanford found that wealthy younger investors are more willing to potentially lose money on ESG initiatives than older or less wealthy individuals.

While hundreds of mutual funds are expected to lose their ESG designations under new EU rules, money continues to flow into these funds. The fund class is called Article 9, which is Europe’s top environmental, social, and governance disclosure designation. Analysts and industry lawyers say a large number of Article 9 funds don’t currently meet the EU’s strict sustainability requirements, with dozens of funds having already lost their Article 9 tag. Hortense Bioy, Morningstar’s global director of sustainability research, said in an email to Bloomberg, “There could be hundreds of Article 9 downgrades in the next six months.” However, the fund class brought almost €13 billion ($13 billion) in inflows last quarter. This brings the total amount over the first nine months of this year to €29 billion, according to Morningstar data. But industry experts don’t know why. Hugo Gallagher, senior policy adviser at the European Sustainable Investment Forum told Bloomberg, “I am somewhat mystified at the continuing inflows. I can only suspect that it’s due to many end-investors not being entirely cognizant of the ambiguities around Article 9.”

Finsum: Billions continue to flow into sustainable funds that are likely going to lose their EU ESG designation and industry experts don’t know why.

Following two years online, October 28-30, the Esports and Gaming Summit took place again onsite. Organized by Gariath Concepts, the event’s renowned as the largest Gaming Convention in Southeast Asia. “At Globe, we are very happy and excited to be part of ESGS this year. In line with our Game Well Played campaign, we have activities in our booth and throughout the entire ESGS event area that promotes multiple products, experiences, and most of all, opportunities to do good,” said Rina Azcuña-Siongco, head of Globe’s Get Entertained Tribe, during a press conference ahead of the summit.

Yet, all might not be peaches and cream on the ESG front. In recent posts, Kevin LaCroix, an attorney and executive vice president, RT ProExec, indicated ESG has a fundamental flaw: it’s void of definition, leading to what he characterized as “sloppy thinking,” according to dandodiary.com.

These ESG related trepidations are explored in a recent post on the Harvard Law School Forum on Corporate Governance. Leveraging cybersecurity as an example, Douglas Chia of Soundboard Governance LLC, illustrates one of the “biggest flaws” of ESG is “the subjective open-endedness of what counts as E, S, or G.”