E.S.G. Investing - What it Means and Its Pros/Cons
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- เผยแพร่เมื่อ 19 พ.ค. 2024
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With larger discussions going on about important ethical issues, I thought it would be helpful to discuss ESG investing, and approach that looks to balance social values with profits.
DISCLAIMER:
This channel is for education purposes only and is not affiliated with any financial institution. Richard Coffin is not registered to provide investment advice and as such does not provide recommendations on The Plain Bagel - those looking for investment advice should seek out a registered professional. Richard is not responsible for investment actions taken by viewers.
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*Green washing* is the key word here.
People (companies) will do and say anything for profit.
Nikola and Lordstrome Motors are the big ones. Those are frauds.
Then you have some cities in China that actually put up hundreds of cheap, defective, and/or fake solar panels around town where people could see them just so they could claim to be green. The construction contractor that built them happened to be owned by a relative of city commissioners.
On the more legal side I heard of one company where the actual CEO made his wife the CEO on paper to boost ESG ratings and get listed on "social justice" ETFs. Or as Richard said many make small to modest sized investments into green energy and recycling type stuff and advertise it prominently to investors/customers. This is by far the most common and is part of what is creating the myth of the green revolution.
When he mentioned Nike, and especially BlackRock, greenwashing was the first thing that came to mind
"Never heard of it" - volkswagon
@@RL-cp1cx For the last time Volkswagen has never been involved with pumping hazardous gasses into the air. And they certainly never sold any cars to someone named Adolf. They don’t even know an Adolf.
I'd be curious to see you revisit this topic now that it's years later. Maybe drill into the difference between rating agencies, how corporate behavior has changed according to the examined metrics, and maybe a case study or two to highlight the positives and negatives.
Never even heard of ESG before the Bud Light media storm. Now I'm trying to learn more about it and unbiased sources are super hard to come by. I ain't educated enough on the issues here to really think one way or the other.
@@harrisonfreund7845 Exactly. Individuals may choose to invest according to the social-justice criteria many commenters are railing against, but ESG _reports_ from rating agencies are more about managing business risk. What might make the company look bad, drive customers away, or attract lawsuits? Common topics include:
*Environmental:* Is the company meeting industry standards for responsible waste management and responsible marketing? If not, they risk attracting regulatory attention. Back in Ye Olden Days, McDonald's used to package their burgers in styrofoam containers, and it was customer demand that led them to switch to paper.
*Social:* Is the company responsive to shifts in consumer preference? For example Monster Energy's ESG report by MSCI notes that demand for low-sugar options has grown in recent years, and the company hasn't done a whole lot to respond to that. They have over 30 flavors and only about five have a sugar-free option.
*Governance:* Are a sufficient number of the Directors independent from the company and its owners? Do they rotate out regularly, or are their Directors so entrenched they may as well be employees? Companies like Tesla and Meta are structured so the CEO also holds a huge share of the voting power, so if you don't like where the company's headed you can't do anything about it.
That being the case, it's important to consider what you personally value as an investor. You can't outsource your ethical decisions to rating agencies. For example, Nestle is constantly catching flak for everything from price fixing to child labor. But they score well enough in other areas like data security and product safety that overall they tend to get pretty solid ESG ratings (AA according to MSCI).
Here's the trick. Who's going to determine the metrics for E.S.G investing?
Whoever is in power at the time
This is the fundamental problem with ESG, centralization of power. Centralization of power tends to lead to corruption, and all the big banks and leftists pushing this crap are already corrupt and hypocritical as it is
ALL READY DONE, ALL ON THE INTERNE NOW
The main company responsible is called MSCI. Look them up, their ESG "tools" are nonsense.
Whoever has their pockets in "green" energy sectors.
Sooo underrated channel i really learned alot form your channel Richard thank you
You know, it’s really occurring to me now how the move from pensions to 401k retirement plans has given financial sector actors (and the laws and forces governing them) a lot of influence over where capital is invested in society.
Where do you think those pension plans invested? The same places.
YES, IT IS SAD, ALL THE COMPANIES DO NOT NOW HAVE A PENSION, THEY ARE SAVING MONEY NOW SWITCHING TO A 401K PLAN,
That Metal Gear alert sound, I see you're a man of taste.
Great video, Richard! I think you made a very thorough and fair analysis. I definitely enjoyed watching this video; thank you for sharing it.
God damn dude, you have a fantastic way of explaining things. It's very simple and precise. Absolutely love it. Keep it up!
This perfectly presents the conversation, you’re amazing, thank you
I’m pretty sure this was an episode on Black Mirror. Crazy.
I've subscribed :) I was looking for a video to concisely explain to my dummy brain. This answered many, if not all of my questions. Cheers!!
Thanks for this video. As usual, topical and well-balanced.
ESG is just socialism, the kinder side of Marxism. No thanks.
I appreciate what seems to be an unbiased source of info on the subject - we need more of this type of information
From the future-ESG Another Woke leftard operation based on politics-Tesla kicked out of index,ohh because Elon Musk called democrats what they are
Great Vid. A subject Ive been waiting to be presented with. Vanguard ooened two new ESG funds recentltly and I am considering investing in one of them
I mean, I have yet to fully form an option on ESG in particular, but here's my take on ethical investing in general: it's not investing in the traditional sense, which is targeted at maximizing return. It's basically a reusable donation: after the company you donate to succeeds, you get an amount that's at least what you put in adjusted for inflation, so you can (1) donate again, and (2) make sure the companies you donate to are solvent.
Or if you're not willing to go that far, you exclude the worst offenders from your portfolio even if it means foregoing gains. For instance, most people are not going to invest in Russia right now, even if the sanctions didn't exist and the returns from investing in Russia were higher than anywhere else in the world, because you don't want to fund Russia's war in Ukraine.
So it's something in between investing with maximum returns in mind and a donation (which is purely for a cause and guarantees a 100% loss (not counting the tax write-off).
Commenting to give you an interaction for the TH-cam algorithm
Love the ending. High horse away!!!
Good to bring up ethical investing in the middle of an EV bubble.
Your high horse bit was awesome!
In India we have something known as CSR ( Corporate Social Responsibility) where companies have to give away 1% of the profits towards social stuff. Only if you have more profits .. like a million dollars
Sadly, it’s very easy to play accounting games to minimize stated profits...
I love the topic of this video. I wrestle with investing and ethics all the time. Big thank you < 3
But you also have to trust them to be ethical in what the ESG gets spent on. What's facts are they using to generate their ESG plan? Most race based components of ESG are straight up racist themselves.
This is a great explanation. Thanks!
Thanks for the valuable info!
🤔 I need a fund that doesn’t invest in ESG companies.
Strive US Energy ETF (DRLL) supposedly is the anti-woke energy etf.
@@-Zardoz- I was going to say this.
I just started reading Grow the Pie by Alex Edmuns. He says Grow the pie & it will ultimately give returns almost for the same reasons you have mentioned here in this video; While another finance professor, Aswath Damodaran talks about all the cons you have mentioned here, also quotes Friedman saying the only social responsibility of a business is to maximize profits... It is so confusing. Also, are companies outsourcing their dirty work to other companies to just look more pro ESG? If possible you should host a debate between these 2 amazing finance professors. Thank you for sharing your balanced views on this extremely confusing topic 👍
BY THAT FRIEDMAN LOGIC, THEN EVERYONE SHOULD INVEST IN METH AND OTHER DRUGS, THE DRUG LORDS ARE MAKING A KILLING ,
As always, quality videos right here!
Great way of explaining stuff. A good teacher always making complex issues simpler. Thanks for that. I have always been supporting companies with postive environmental impact and always was a big fan of Tesla until they invested money in Bitcoin which was mind-boggling. One side you made energy efficient cars and another side you invest in bitcoin that consumes so much energy in mining globally. What happened to their ESG standards...... Disappointed. Thanks for your excellent video.
SMH… Bitcoin mining is a software/hardware computing process. It’s NOT actually mining, like ore or coal. How old are you?
Amazing vídeo, thank you!
Its been a very long while. Finally.
Absolutely love this!
And who determines the "social" aspect? Ah right, the types of people who got youtube to remove the dislike button.. very popular and universally accepted beliefs on things social!
Ethics make a lot of difference. We put out our latest video on viatical settlements- how people make money through death. Is that ethical?
Is ESG going to bail out Boy Light And Nike and Adidas and Miller and Starbucks?
Finally, an episode about ESG. Social responsibility and profit shouldn't always be mutually exclusive, but in the name of profit it often is the means to its ends.
For the australians here, i would recommend Future Super as an ESG investing strategy
Hey thank you SOooo very much!! Good looking out! 😄👍🏽👍🏽👍🏽
I am doing a presentation and will add your video to references ! Nicely explained the pros and cons, very detailed and clear.
Is pigment based diversity real diversity? Isn’t that just CRT?
So, are pharmaceutical companies more ethical than firearm manufacturers? Firearms are primarily used for sport and personal protection.
Only if they have more nonbinary people on their board of directors
Good point
Bad point- read book by Dr Lott on the role guns play in saving lives & property
@@kirbydrake4417 Isn't saving lives and property the same as personal protection?
That could potentially be true in places like the US, but firearms manufacturers are notorious for selling to dictatorships and other shady actors so I would still consider it to be unethical overall. That said pharmaceutical companies are also unethical in my opinion.
"Ethical" doesn't automatically equal "moral superiority" as ethics are disputed.
That is literally what it means. "Ethical" and "moral" are synonims. To invest ethically is morally superior to invest unethically. And its a consensus that investing in an evil company is wrong.
@@luismigueltolda3571 Evil? What company stays in business that is doing “evil” things? This ESG, while maybe having good intentions, has turned into nothing more than a pay-to-play control mechanism for rich and powerful elitists. It is an identifier to apply cancel culture tactics within the financial/business world.
True. After all, even some countries believe it is ethical to reduce Down syndrome to 0%, and the ethical way to do this is to abort absolutely every single blastocyst, foetus, and baby who has the genetic defect.
If this kind of gross error is a national priority, one can imagine the ethical disparities between so many companies and investors.
Khan: agreed! Whose ethics are behind the money & power? The corporate & governmental push to green power requires slave-style lithium mining
Ethics are usually pretty well defined. Morality is actually more relative than ethics as are usually a code and morals are base around arbitrary upbringing.
If you want a donation that's cheap, easy and effective, donate to the World Wildlife Foundation, maybe $10 or $20 or so, they'll give you a calendar and animal plushies. You'll get a charitable tax break for the amount you donated, get a calendar with nature, and you get cute animal plushies, which you can give to your younger cousins or nephews/nieces.
Just a clarification here 5:08. 0% of your investing dollars go towards the business that the stock represent. You are paying OTHER investors for that stock. So no, your investing money will never become "donations" to a business.
Companies do NOT raise money through stocks outside their initial IPO, so deciding not to buy Shell stock because you don't want to support Oil business is wrong, or at least ineffective.
Companies care about CONSUMERS. If you don't want to support a business, just make sure you are not one of its consumers. It is that simple.
Or if you have a lot of money, DO buy a lot of that business stock so you can influence its board of directors on better directions through shareholder votes.
That's a good point, although to be clear, companies DO (or at least, CAN) in fact raise money after their IPO. Many growth companies continue to issue and dilute their shares after going public to raise capital. This is why a higher stock price still matters for companies - they can utilize the stock price to issue more shares when the price is high.
You can always see whether a company is increasing (i.e. issuing shares) or decreasing (i.e. buybacks) their share count by looking at their cash flow statement, which tells you how much their spending and receiving for their shares.
@@ThePlainBagel I was pretty sure companies could not issue more stocks after their IPO. I thought they could only split shares.
I think my points still stand though, as companies raise capital primarily through leverage after their IPO, so buying a company stock never really finances any of its activities.
You are right that the board and C-suite care a lot about stock price, since so much of their equity is tied to it, but our individual ability to affect stock price through buying shares is none. Daily traders set prices, not common investors.
I say these things to try and provide my perspective on why ESG funds are misleading. If a person thinks she is doing his or her part by focusing their investing in ESG, they need to know that their impact, even collectively with other ESG investors, is almost none.
If you want to have an impact, be a conscientious consumer and voter. Leave investing out of it.
@@williamrosa4005 Yea that's certainly still a good point - buying a stock doesn't mean the money is going directly to that company, but sometimes it does! A lot of start-ups (including many ESG companies since they tend to focus on new technologies) actually do rely on issuing shares over debt after their IPO because they can only take on so much leverage. There's usually a cap to how much a company can raise through debt, especially as a new company, so many turn to secondary stock issuances. A company like WEED for example (not ESG, but a young company) had 50.75M shares in 2015 (they went public in 2014) and as of 2020 they have over 350.11M, so actually the majority of their stock was issued after their IPO. All this is just to point out that a higher stock price does in fact benefit these companies.
As for who determines the stock price, I agree with you there, a lot of the time it's institutional money influencing what the stock trades for.
@@ThePlainBagel Thank you so much for these clarifications. The more I learn about the world of investing, the more I realise how little I know.
Now I'm off to try and understand how new shares are created after the IPO. Wouldn't this dilute the existing shares?
@@williamrosa4005 You're not alone! I'm always finding out new things about the field, and I work in it haha.
Very good and informative video! I like that you looked at the topic from multiple perspectives :)
It can be easy to feel ethically removed from your investing decisions because you don't see the direct impact. I'm going to make it my goal to become more knowledgeable in my investments so that my money is going to more ethical and sustainable companies.
It's difficult to know which companies are indeed ethical. Most want the appearance and use advertising and gimmicks to appear that way when they're not. I focus more on my spending of hard earned money (shopping, groceries, clothes, restaurants, entertainment, etc)
Just don't presume ESG is a good qualifier for that.
ESG Another Woke leftard operation based on politics-Tesla kicked out of index,ohh because Elon Musk called Democrats what they are,and the purveyors of lies and death 107,000 dead from open borders
And what do you consider "ethical", whatever the latest social ethics fad you've read about in The Atlantic? I bet you wouldn't know ethics from your own asshole and just invest in cheap, feelgood nonsense like "diversity equity and inclusion", without consideration for the lives that destroys.
Lol bot
60% of my 401k is in a Global Sustainability fund. A big reason I chose it is because I want to avoid supporting some companies I find... evil...
You don't really support companies when holding stocks. Focussing too heavily on esg might hurt diversiry and increase risk without increasing expected returns. And maximizing returns is what investing is all about. My motto is: Invest smart, live green.
@@DekarNL The whole point is not increased expected returns. The point is to do the right thing. Example: You don't buy organic food because it is cheaper (= that would be higher return). You buy it because you don't want to be responsible for environmental desctruction.
@@spacemanschannel6380 the whole point of investing is getting returns. And whether or not you holding stocks does not change a company's policy. Ben Felix has an interesting video on this subject too.
@@spacemanschannel6380 Lol, you support company by buying its product. Not stocks.
Little typo at: 6:55 I think you are referring to Jeremy "Bentham" instead of "Benthlem" (aka utilitarianism guy). Otherwise, great video and channel, keep it up!
Opps, ya that's a typo, thanks for pointing out!
@@ThePlainBagel Oops*
@@killaryhlinton8853 - lol ..the asterisk* .. (Snickering..)
This video is far more informative and easier to follow than CNBC's ESG video. From what I've learned from this and other videos, traditional investing is for me. If I want to do good things, then I'll do good things. I'm not going to support something that sounds good while doing basically nothing or the opposite. Placing diversity/inclusion over skill/experience doesn't reflect my values. Since ESG is mostly about investing in companies that pander to leftist mob pressure, I'll pass.
This video doesn't do enough to underscore what a sham the esg rating really is.
I think I'll stick to just the E with this one, not going to waste my efforts on S and G
Who determines what it is “positive “ in the age of misinformation?
And here we arrive at the crux of the issue. Instead of letting dollars, customers, and investment decide, we will have to relegate the arbitrary decision of what constitutes being "positive" into some entity's hands. Nobody can know how this entity would define what is "positive", but I don't think it's unreasonable to assume it would not be in the interest of the world at large.
Excellent video, can you explain in another video how buybacking shares boosts the price of a stock?
A companies market capitalization divided by the number of outstanding shares equals the share price.
Reducing available shares (buyback) makes for a higher share price. Simple arithmetic, and indication of a strong company.
SIMPLE THE MORE STOCK A COMPANY BUYS BACK, THE LESS THERE IS FOR EVERYONE ELSE TO BUY, SUPPLY AND DEMAND CONTROL ALL PRICES,
I am obsessed with ESG lately
WELL, THE BIG BOYS WILE MAKE TRILLIONS IN THE FUTURE ON ELECTRIC CARS, SOLAR, WIND, N UCLEAR AND HYDROGEN, BUT JUST BE CAREFUL, THEY ALL ARE NOT MAKING MONEY YET
Doing research for a young person who wants to start investing but is socially responsible. This helps.
YES, INVEST IN THE TOP RATED ESG STOCKS, TRILLINS TO BE MADE ON THE HIGHEST RATED ESG STOCKS
I'm curious, not skeptical unlike these blokes
Is this gonna be “fair trade” or “locally grown” but for stonks
Yes.
An extra premium for a sense of moral superiority.
can you also cover SPAC?
13:17 i dont even know if this segway is ethical
im not joking
alot of small businesses are struggling. not that i would even do anything im not a perfect person. its just food for thought
Aren't ESG Investing and Sustainable Investing two different things? At 2:15 you are saying that it is the same (you say "broadly refer to as ESG..". I'm a bit confused
This was bloody helpful. Looks like ESG is much like CCP (judge, jury and executioner).
WELL, YOU DO KNOW THAT CLIMATE CHANGE IS NOW NUMBER ONE IN THE WORLD, ONLY INVEST IN THE HIGHEST ESG STOCKS LIKE MICROSOFT
Thank you for sharing about this topic. It is very informative and well thought of. I agree that it is the most controversial topic. But I believe that there is a consensus that ESG investing can be used as a risk management tools
ESG Another Woke leftard operation based on politics-Tesla kicked out of index,ohh because Elon Musk called democrats what they are
There is no such consensus
How about retiring on a pension based on your years of work and salary at time of retirement?
STOCK ONLY GO UPPPP!
I think that this battle is much better fought on the consumer side rather than through investing...at least for major companies that sell consumer products. Consumer trends will get the company to change for the better much more effectively than ethical investors. I would imagine that the group of investors that put ethics at the top of their list of considerations is pretty small.
Very cool video! Good job
ESG can definitely make you some money!
Yup, by inversing it. That’s been empirically proven BTW, see the multiple papers nicely aggregated in Ben Felix’ 2018 article titled ‘Responsible/ESG investing’. Anyone who claims to generate alpha from ESG is lying.
I guess you CAN make ESG-related profit, now that I think about it: come up with some hilariously vague ‘ESG framework’, then sell an ESG ETF with ludicrously high fees (as most of them have). PT Barnum would be proud of the folks making money selling ESG funds 🍭
Glad you brought this up. I only wish ethics were more of a consideration. Too much greed with no moral thought.
You can invest in whatever companies you want, nobody is holding a gun to your head.
I've always voted with my dollar. I support small local businesses, not large giant companies. Worked long enough at a few to know how unethical they are.
I also only shop at places that honour face mask exemptions. If they put themselves ahead of people with disabilities struggling during this time I shop elsewhere.
PS most unethically "companies" are governments with so much corruption and massive deficit spendingmi would NEVER buy a government bond ever.
Well Done! I'd love to know more on how to decide which companies are the worst for ESG.
ESG is used as a weapon to promote degeneracy and demographic replacement. They will use it to harm companies that do not promote globo homo, trannies, pedos, diversity, etc. and also companies that do not discriminate against Whites. They want to replace us with migrants. The Kalergi Plan.
WELL, OIL COPANIES ARE THE LOWEST OF THE ESG STOCKS, MICROSOFT IS THE HIGHEST RATED ESG STOCK,
Depends on government grants, can fail overnite
its all con a big one
Is the horse a reference to one of the latest Musk's tweet?
where can i find the sources ?
Imo companies who tries to achieve "Cultural/gender diversification" is the classic example of poor Corporate governance which eventually make their stakeholders ( shareholders mainly) suffer. You should hire people based on their merits and their competence. It doesn't matter if they are blue, red or green in color or comes from different planet or if they are he, she or bi. You're hired to get job done, period! There's hirarchy of competence for some reason! Companies do this just to sound more "ethical" which they aren't.
But having only selected a limited group of ppl from the total population indicates that, either hiring practices are biased and thus not selecting the most qualified ppl, or a societal problem not giving everyone a fair chance. Both resulting in human potential being wasted. Though clearly in both cases just hiring because, mu diversity is not the solution. And for some reason the loudest diversity initiates just do this, fight the symptoms with actually solving the underling issue.
Viewers beware that ESG is extremely dangerous. The problem is that someone has to set the ethical standard. While on face value it sounds great, it puts that power in a small number of people, and if anything is true it is that power corrupts and absolute power...well, I'm sure you've heard that one before. Companies and governments are starting to join together to form ESG credit scores that have to be abided by in order to get loans or conduct business. These ethics standards are not being voted on, they are being decided. In turn this will allow anyone who decides the standards to squeeze out competition in a market and force people to use the "approved" companies. As a bitter side note, companies that have money to play with can buy their way into getting a higher score even if they don't meet the standards, and their competition that has no spare change is left to crumble if they don't adhere to the standard or the people in power decide to shift the standard to not allow the company into the club. Just think of ESG as a massive corrupt DMV type bureaucracy, where, if the people in power don't like you, they add more forms for you to fill out, more fees for you to pay, longer lines for you to wait in, and when you finally get it all done, they just put out a new form that nullifies all the work you just did and sends you to the back of the line. Those other guys, well, they just pay the inconvenience fees and move along. Hope you read this and look it up for yourselves, but if history has taught us anything it's that the business that values the customers (not consumers) over profits will get both.
Disney is killing it!
Can you do a video on the Nixon Shock
When he broke up the dollar the not back by gold anymore
Realistically, is there any corporation actually worth investing in for good financial returns that doesn't violate at least one of these requirements that would get it the boot?
I DONT THINK THEY GET THE BOOT, THEY JUST HAVE A LOWER SCORE, AND YOU CAN STILL INVEST IN THEM IF YOU WANT TO
Guys. What can you say about the Freedom Emerging 100 ETF? Heard it's a good ESG ETF
is Fidelity behind that? What's the ticker symbol
I suppose it would be a good investing methodology to look into, especially if it picks up at such a pace. Because it would be an indicator of market demand...
ESG is used as a weapon to promote degeneracy and demographic replacement. They will use it to harm companies that do not promote globo homo, trannies, pedos, diversity, etc. and also companies that do not discriminate against Whites. They want to replace us with migrants. The Kalergi Plan.
Esgs out perform the benchmarks generally. So idk where the financial shortcoming part stems from. If you’re under diversified in any category that’s on you, not the environment. And saying the fund may not fit your values... compared to what? Like if you’re in a different just plain non esg index how does that fit your value?
My point on the values is simply that some people buy ESG funds assuming it’s an investment in green energy, when in fact many ESG funds hold oil and gas companies. It’s better than nothing yes, but it’s just a point worth clarifying!
@@ThePlainBagel I feel ya. It can be very complicated. Example some oil and gas companies are big investors in green energy. But ESG funds catch a lot of flack for even attempting to be better whereas their counter indices go unscathed for literally doing nothing at all. Seems like misplaced energy. It could be worded better. Like an ESG Fund won’t be perfect but is WAY more likely to fit your values than a broad index with no esg component whatsoever. Every video on TH-cam says “well you may be leaving returns on the table” for one that’s not true at all and 2 EVEN if it was true, which it isn’t, values have a cost. In the case of ESGs the cost is...... you’ll probably make more money.
This reminds me bad of companies who contributors to nonprofit lobbying groups like ALEC ..
"The Saturday morning cartoon shows depict wicked polluters who pollute for the sake of polluting, not because polluting is a necessary byproduct of some useful activity."
Polluting is a form of externalizing cost. It is always cheaper to dispose of an unmarketable byproduct (aka "waste") onto the environment, your neighbor or taxpayers. It is never "necessary" but dumping your shi...stuff onto another is convenient and profitable. Your rationalization that polluting is sometimes OK because it is a byproduct of another useful process is exactly the problem that ESG investing attempts to resolve. Sadly, far too many useful and profitable processes in the marketplace are only such because some of their costs are externalized.
Thsi feels like whole foods vs conventional foods situation except being financial.
Nothing is clear cut, except that ai is a powerful tool and enables totalitarian governments. The 2 are not mutually elusive and more likely, are strongly correlated.
Some of the statements made in this video are theoretically correct but are emperically incorrect. For example, the differential in valuations between a traditional equity index and an ESG index is negligible - so you can still get a first mover advantage. You get a higher exposure to the quality factors and you can expect marginally better returns than the traditional index. This is offset by slightly higher fees and the weightings used to maintain sector exposure. Where these indices come into their own is that companies with strong ESG profiles have substantially lower odds of experiencing severe risks incident (about two third less), and are much better positioned to transition to a low carbon world. Longer term, this suggests you are likely to have lower downside risks and returns are likely to benefit from this. This is evident in the recent pandemic crisis data. Active managers that can identify ESG momentum and those companies with the best ESG profiles have delivered significant outperformance, provided you have selected an asset manager that is focussed on the financially material ESG factors. MSCI data clearly highlights the benefits of factoring in ESG using a passive or active approach. I would encourage you to contrast sustainability and impact funds - you will see their relative performance has been very good over the past decade.
It has nothing to do with investing based on fundamentals. It is just another trend/media/popular topic investing. Such as crypto/eletric vehicles/marihuanna stocks.
I'm investing some in the three Screened ESGs that iShares/Blackrock currently offer. Admittedly they have a 3x expense ratio to their Vanguard Index alternatives. My hope is that ESGs eventually incentivize all companies to do better over time.
IT IS BETTER TO INVEST DIRECTLY IN THE TOP RATED ESG STOCKS, LIKE MICROSOFT, TESLA AND A LOT OF OTHER ELECTRIC CARS, AND SOLAR, WIND AND HYDROGEN
EGS investing might hurt your returns. Focussing solely on EGS stocks trades off diversification and increase risk. I would simply advise to live a sustainable life, and invest smart.
YOU CAN INVEST IN ANY STOCK YOU WANT, JUST KN OW WHAT YOU ARE INVESTING IN AND IF THEY ARE GOING TO MAKE MONEY IN THE FUTURE 20 30 YEARS, IF YOU HAVE THAT LONG BEFORE YOU NEED THE FUNDS,
Sounds a little trite in some aspects., eg governance. It is easy enough to eschew whatever offends, but not so easy to implement how a company operates, unless one is the CEO. Then, he is a patriarch. ⚠️ I want money to be my servant, not vice versa. EFTs exist that cover all bases.
Money talks, merit walks.
People will be targeted depending on what stocks, loans, they choose to get. Fossel fuels, natural gas, nuclear energy is a must for survival. Renewable has a high esg score but doesn't help the 90-95% of the population.
I sold all of my facebook stock because simply I was supporting a monster. I wish we'd all put our dollars where our morals are.
Yeah true, unfortunately, we still fund things like wars through taxes so politicians get to hand contracts to their cronies killing people around the world saying it's in [any country]'s interests. In a way, we're forced to "invest" into all sorts of horrible stuff.
I’ve never trusted Facebook
People do put their dollars where their morals are.
ESGs should include nuclear power IMO
Making money other ways isn’t unethical like your title implies. You’d think a money channel would be aware of this
The ethical responsability of an asset manager is to maximize perfomance, however defined, for its clients. To ask the financial industry to be the the arbitrator of what is a huge moral hazard in itself. People should vote, in the booth and with their wallet if they can, to produce the change they want to see happen in the world. The financial industry will follow wherever the money and regulations allow it to go.
Thank you for your video! Thanks!
I'm just gonna buy gold and bitcoins goddamn
ESG is insanity. If it would be just enviroment - lets say product life cycle assesment etc., that would make sense, now it is just stuff like Bud Light commercial, where they tried to pimp ESG score and destroyed their business. I bet investors love ESG. Avoid it
🤯
jeremy... benthlem?
Bud Light's parent company Anheuser-Busch (InBev) has done more to educate the common folk about the importance of ESG.
I think I’ll stick with my diversified portfolio and donate to non profitable charities :)
Check out Ghana and check out Sri Lanka those two counties have destroyed themselves with this esg Manure