Accelerating The Momentum Toward ESG (Environmental, Social, Governance)
Overview
Increasing data availability and shifting investor focus toward ESG integration has led to rapid innovations in the financial industry as demand grows for impact investing. Research suggests that ESG Tilt strategies can earn competitive returns, with particularly favorable results in emerging and European markets. Meanwhile, ESG Momentum strategies appear to provide the greatest probability of earning excess returns for impact investors by rewarding companies with improving “material” environmental, social and governance factors. When implemented thoughtfully with active management, impact investing can achieve social goals, as well as produce competitive and even excess returns over a benchmark.