(New York)

For many years ESG had been a fairly neglected asset class. Advisors and many retail investors thought that investing capital with moral considerations would hurt returns. Over the years many things have changed, including investors learning that ESG screens have actually led to outperformance in many cases and younger generations showing that they care a great deal more about these issues than their parents. Well, those stimuli have led to huge growth in the ESG space, and are leading to big revenue gains for asset managers. Fund providers are able to charge significantly higher fees for ESG-focused ETFs because of their moral importance to clients, and this has led to good fee revenue in an industry that is otherwise seeing contraction.

FINSUM: The key thing to remember here is that ESG funds don’t cost any more to run, so this is highly profitable for asset managers.

(Washington)

ESG has been doing very well. Not only is it getting more public attention, but it is receiving significant inflows. Well, things are about to change from the corporate and regulatory perspectives as well. The Biden administration’s SEC is preparing to adopt a new policy on shareholder resolutions that relate to things like ESG and social justice. The Trump administration had made it very easy for companies to dismiss such resolutions as “micro management” but the current SEC aims to give them more teeth. While such resolutions—things like demands to report gross carbon emissions, or minority compensation—are not legally binding, they do put management under pressure to answer tough questions and garner a great deal of press.

FINSUM: This is going to compel top management to play ball with shareholders on resolutions they would otherwise love to ignore.

(New York)

The post-pandemic bull run has touched the breaks, but not necessarily stopped the momentum. However, Bank of America’s Sell Side Indicator…View the full article on our partner Magnifi’s site