They went on to say that Jaresko is fully justified for calling out companies for “not walking the talk of socially responsible corporate behavior. Our evidence suggests that Russian-invested European firms that have higher overall ESG scores, and even those with higher ‘social’ scores, aren’t more likely to take meaningful action in response to Russia’s invasion of the Ukraine.”
So where does that leave ESG? It’s not clear that all this skepticism is having any impact as money keeps pouring into the sector. Last week, ESG-focused ETFs attracted $1.8 billion, the most since early February, even as the S&P 500 index dropped about 3%.
Proponents of ESG say that skeptics don’t understand how ESG is used in the investing process. It’s not about doing good with your money, per se: They contend it’s essentially a tool to help measure a company’s resilience to financially material ESG-related risks. MSCI Inc., the leading provider of ESG scores, says on its website that the ratings aren’t “a general measure of corporate ‘goodness.’”
This article was provided by Bloomberg News.