Equities | ESG & Climate Change
ESG ETFs Are Not About ESG Investing
- By John Tierney
- 3 min read
Back in May we asked, does an investment strategy based on environmental, social, and governance (ESG) principles make sense from an investment standpoint? For reasons summarized below, we concluded it conferred little or no advantage. In this note, we examine how a selection of ESG-oriented ETFs have performed versus SPY – the ETF that tracks the S&P 500.
The Manifold Problems With ESG
What Performance? For all the hype about ESG investing, and the effort of many companies to appear ESG compliant, there is little hard academic evidence that following an ESG-oriented investment strategy produces superior investment returns or is a distinct investment factor (like value, small company or momentum, to name a few).
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