Informative: active investors can show disapproval by avoiding/ selling companies with bad practices.
The problem: ESG standards and Fund badging do not work as they are misguided. E has the wrong measures - nothing to stop E.g. plastics pollution. S is vague. G has the wrong measures E.g. Tick for putting a woman on the board but ignore egregious stock options & pay for directors who add nothing.
I largely agree. The main problem with ESG metrics and regulation is that we are trying to figure this out as we go along. It reminds me of the early days of accounting standards when reading a financial statement was much Häme der because the reported numbers were not standardized and everyone did what they wanted. I think over time we will sort this out as we learn what works and what doesn’t but it is going to take many years.
Informative: active investors can show disapproval by avoiding/ selling companies with bad practices.
The problem: ESG standards and Fund badging do not work as they are misguided. E has the wrong measures - nothing to stop E.g. plastics pollution. S is vague. G has the wrong measures E.g. Tick for putting a woman on the board but ignore egregious stock options & pay for directors who add nothing.
I largely agree. The main problem with ESG metrics and regulation is that we are trying to figure this out as we go along. It reminds me of the early days of accounting standards when reading a financial statement was much Häme der because the reported numbers were not standardized and everyone did what they wanted. I think over time we will sort this out as we learn what works and what doesn’t but it is going to take many years.