What is ESG?

ESG stands for Environment, Society and Governance, three aspects of how corporations do business and manage their risk. We've all heard of oil spills, pollution, labor abuse, child laboring, audit scandals, corruption and many other incidents that create negative impact and raise attention towards environmental, social and governance issues.

Quoted from NEI "Identifying and tracking environmental, social, and governance (ESG) risks as a part of the investment process helps contribute to better long term performance and potentially eliminates problems before they become costly mistakes." Many studies indicate that corporations that perform better ESG management, have lower risks and even outperform the market in return.  

Many mutual fund, PE fund and pension fund managers have taken the practice of impact investing/social responsible investing (SRI) and reported positive or even outperforming results. However, methods to quantify and evaluate ESG performances are still developing among different institutions and yet  to come to standardized principles or methodologies.


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Hi, this is Winnie from Taiwan. I'm interested in sustainable finance and trying to explore as much as I can. People (at least in my country) rarely know about this new field in finance that has developed drastically over the past decade, so I thought, well, why not spread the idea a bit. I don't have much time to dig deep, but this blog is a way to share what I've read from official/academic reports and websites.
Feel free to leave comments!
Let's learn together!
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More definition from different institutions:

Investopedia
CFA Institute 
Nordea
Investor Advocacy Clinic
European Association for Quality Assurance in Higher Education (ENQA)
Principle for Responsible Investment (PRI)


Media:
Green and Blue Tomorrow
Forbes-ESG-Themed Investments: What Are They And How Are They Managed?
Experimental Study Group 
InvestmentNews-Why it's time to believe the hype behind ESG investing