ESG companies have slight edge over non-socially responsible peers
From www.investmentexecutive.ca |Published on May 27, 2014 16:00
By Fiona Collie
Early research from New York-based GMI Ratings indicates that companies that consider environmental, social and governance (ESG) issues in their executive pay and board oversight have a slight edge over their peers who do not.
Gary Hewitt, head of research, GMI Ratings, discussed the new findings as part of a panel discussion on socially responsible investing (SRI) performance at the 2104 Canadian Responsible Investment Conference in Toronto on Tuesday.
The research compared the total shareholder return (TSR) of U.S. companies between 2011 and the first quarter of 2014 of companies that include ESG factors in executive pay and board oversight against those that did not.
According to the research, the median ESG company’s TSR slightly out performed its non-socially responsible peer (3% cumulatively over three years), meaning a company in the same industry with similar market capitalization. read more>