As resistance to #ESG investment practices grows, many corporations and fund managers are shifting their strategy.
This does not mean that they are abandoning #ESG. But actually, as the linked WSJ article below observes, they are simply changing the language they use to describe their #ESG efforts.
Take the following excerpt from the article:
"Following years of simmering investor backlash, political pressure and legal threats over environmental, social and governance efforts, a number of business leaders are now making a conscious effort to avoid the once widely used acronym for such initiatives."
Maybe it's just me, but this practice seems deceptive.
Investor backlash regarding #ESG primarily relates to the idea that #ESG criteria may lead to suboptimal investment performance. Additionally, #ESG funds typically charge higher fees, due to more stringent research & analysis costs.
From the perspective of the average investor, it is expected that those you entrust with your capital will focus on ROI, rather than political or ideological conformity. This is especially true in an era of rising #inflation & costs of living.
Obviously, some investors prefer to allocate their capital towards funds that include #ESG principles in their investment process. They have strong convictions and prefer to support those who support their cause.
However, those who deceive investors by cloaking #ESG investing to prevent investor reluctance and/or the withdrawal of investment, are engaging in unethical practices.
Another excerpt from the article illustrates this point perfectly:
“Most companies are moving forward operationally with their #ESG programs, but not publicly touting them, or describing them in different ways.”
The fact that many proponents of #ESG have decided to resort to deceptive means to prevent financial losses is a total contradiction - as ESG policy specifically emphasizes its goals above financial considerations.
In my view, asset managers should follow a policy of transparency. If your company or fund follows #ESG criteria, state it publicly and proudly. The same goes for those for those who eschew #ESG.
https://loom.ly/YMzr4IA
