“New research finds that when fund manager skill is discounted from the equation, sustainable investing portfolios performed at 0.2% lower than the proxy for the US market… However, recent research from Kroll found that companies with better ESG ratings outperformed their peers with lower ratings from 2013-2021.”
[COMMENTARY] How do you measure ‘fund manager skill’ when funds that outperform in one year fall to the bottom of rankings the next year? That might be an exaggeration — but not by much! Research is complicated. For ethical and sustainable investors, ethics, morality, and other personal or spiritual values must come into play too.
Often lost in this discussion and important to many such investors is the old adage ‘as ye sow, so shall ye reap,’ or from physics ‘every action has a reaction.’ So, if you value your personal or spiritual development, these things need to be taken into account in your investment selections.
Does sustainable investing underperform? By Rose Mary Petrass, October 5, 2023, Sustainability, Australia.