Showing 11 - 20 of 326 entries
MSCI BlogIs There a Green-to-Brown Premium?
As investors evaluate the possible reallocation of capital around the transition toward a low-carbon future, we analyzed the characteristics and performance of “green” versus “brown” companies. Was there evidence of a “green-to-brown premium”?
Research PaperComparing Risk and Performance for Absolute and Relative ESG Scores
ESG investing is undergoing a pivotal shift. Investors are increasingly moving away from asking “if” ESG can add value to their strategies, and toward questions of “how” and “where.” As investors debate whether an absolute or industry-relative score may serve them better, we tested how these different ESG signals correlated with financial performance. Both scores correlated with higher profitability characteristics and lower levels of idiosyncratic and stock-specific risk. The...
Research PaperClimate Change and Low-Carbon Risks and Opportunities in China
A transition to a low-carbon economy could alter the risk-return profile for many industries. The MSCI Climate Change Indexes aim to be practical tools to assist institutional investors in reflecting these potential changes in their investment strategies. They seek to do so by increasing the index weight for providers of low-carbon solutions and decreasing the weight of companies negatively exposed to such changes while seeking to maintain broad market exposure. In July 2020, MSCI launched...
MSCI BlogManaging Climate Risk in Equity Portfolios: A Case Study
Institutional investors are increasingly focused on mitigating their climate-related risks. How could a “typical” active global equity manager have managed these exposures without disturbing the portfolio’s risk and return characteristics?
MSCI BlogWould Integrating ESG in Chinese Equities Have Worked?
ESG ratings have reflected financial risk and returns in developed-market and emerging-market equities. But was this true in China, where ESG considerations are still in their infancy?
MSCI BlogESG Ratings: How the Weighting Scheme Affected Performance
Our recent research suggests that environmental and social issues were more industry specific and tended to show up in financial measures over a longer time frame compared to governance issues. How can E, S and G issues be combined?
Research PaperManaging Climate Risk in Investment Portfolios
Investors are increasingly concerned about how climate change and a transition to a low-carbon economy could impact the risk and return profile of their portfolios. In this case study, we selected a sample portfolio representative of a global actively managed fund in terms of its risk-return characteristics and used the MSCI Climate Value-at-Risk model to examine the different dimensions of climate-related risks. We show how Climate VaR can be used to measure climate risks for the portfolio...
MSCI BlogWhich ESG Issues Mattered Most? Defining Event and Erosion Risks
Very different ESG issues can be material for different industries. Our research suggests that risks can be divided into two main types: “event” risks and “erosion” risks to companies’ long-term competitiveness. Which ones mattered most for E, S and G?
Research PaperEngaging Companies on Palm Oil Deforestation
Top palm oil buyers and producers have set zero-deforestation goals, with many committing to achieve this target by 2020. This paper introduces MSCI’s data and research in this area.
MSCI BlogIs ESG All About the ‘G’? That Depends on Your Time Horizon.
The conventional wisdom has it that governance is the most dominant of the three E, S and G pillars. But our analysis finds different results when looking at contribution to performance over different time horizons.