Environmental, Social and Governance: Moving to Mainstream Investing?

BY: BUSINESS FOR SOCIAL RESPONSIBILITY

The topic of incorporating environmental, social and governance (ESG) criteria as part of long-term company valuation by financial institutions has been entering mainstream debate in recent years. Although many mainstream financial institutions, such as ABN AMRO and Goldman Sachs, have begun considering the effects of including ESG criteria as part of their fundamental financial analysis, investors are waiting for vetted proof of long-term materiality before fully incorporating the criteria. If ESG criteria become part of mainstream investment analysis, it can have an important influence on how public companies manage these issues. It is therefore important to understand how these criteria are being incorporated by mainstream financial institutions, as well as the barriers that have currently prevented such integration from becoming universally practiced. This report investigates the effectiveness of financial services companies at incorporating ESG criteria into mainstream investments. With regard to incorporating the ESG criteria, the report evaluates the challenges that have been faced and solutions that have been proposed industry-wide.

Click here to view entire report: http://www.bsr.org/reports/BSR_ESG_Mainstream_Investing.pdf