Can Good Corporate Citizenship Be Measured?
"A new study that tries to quantify and correlate stock performance with E.S.G. factors is generating a lot of chatter among the investor class. The study, developed by a team of quantitative strategists led by Savita Subramanian at Bank of America′s Merrill Lynch Global Research unit, appears to be the most expansive, looking at several hundred companies over a decade starting in 2005."
[COMMENTARY] Interesting analysis. Largely supportive that a focus on ESG may provide improved returns. However, I’d appreciate it if the study mostly discussed in this article were published in a recognized financial journal with proper peer review. For me, the ’gold standard’ in ESG – financial performance is,ESG and Financial Performance: Aggregated Evidence from More than 2000 Empirical Studies. Admittedly, it only looks at ESG and corporate financial performance, whereas, Subramanian’s et al study above relates ESG to stock performance.
For another view on ESG and investment performance, see,From the Stockholder to the Stakeholder: How Sustainability Can Drive Financial Outperformance, by Arabesque Asset Management and Oxford University.
Can Good Corporate Citizenship Be Measured? By Andrew Ross Sorkin, June 26, 2017, The New York Times, USA.