As capital floods into sustainable finance products and strategies, companies are finding themselves assessed by investors against a whole range of novel performance indicators. We have talked before in this series on ESG data trends about how this is driving a shift towards a common language on ESG investment, and, also challenging market participants and data provider on materiality.
Environmental, social and governance (ESG) metrics can dictate under- or overweighting in indexes or portfolios, or even the inclusion or exclusion from an investable universe. The incorporation of ESG factors into investment strategies is shifting capital away from poor ESG performers towards their better performing peers.
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