ESG Research

More and more institutional investors are integrating environmental, social and governance (ESG) factors into their investment processes. Our research is designed to help investors identify risks and opportunities, and focus in on key ESG performance drivers.

 


 

FEATURED Research papers and Blog Posts


Enhancing Economic Value with ESG

Research Paper: In this paper we apply an ESG filter to a highly selective universe of 100 companies that have already been screened for value creation as measured by ROIC, economic spread, margins and asset turnover ratio. We found that those with higher ESG Ratings had higher average ROIC and were valued at a premium compared to companies with lower ESG ratings.


Did ESG Ratings Help to Explain Changes in Sovereign CDS Spreads?

Research Paper: Natural disasters, political upheaval and corruption scandals are just a few of the shocks global investors have had to deal with in recent years. Analysis of environmental, social and governance risk factors at the country level may help investors to better understand the cause and consequences of these events, and how they fit into their sovereign credit risk assessment.


How to integrate ESG without sacrificing diversification

Blog Post: Bigger, faster, more. Whether due to policy, technological or climatic changes, companies face an onslaught of challenges that are happening sooner and more dramatically than many could have anticipated.


Has ESG affected stock performance?

Blog Post: Are ESG characteristics tied to stock performance? Many researchers have studied the relationship between companies with strong environmental, social and governance (ESG) characteristics and corporate financial performance.


Out of Whack: US CEO Pay and Long-Term Investment Returns

Blog Post: Last year, we asked whether pay awards to U.S. chief executive officers reflected long-term shareholder returns, and found they did not. The bottom fifth of companies by equity incentive award outperformed the top fifth by nearly 39% on average on a 10-year cumulative basis.


Integrating ESG criteria into factor index construction

Blog Post: Institutional investors increasingly are moving toward integrating ESG criteria into their portfolios and their factor allocations, in particular. This shift is driven by their recognition of the financial relevance of ESG issues to their risk management and their focus on long-term sustainable investing.


How Institutional Investors Are Responding to Climate Change

Blog Post: How are institutional investors tackling climate-change risk in their portfolios? Thanks partly to global initiatives such as the Montreal Pledge1 and the Portfolio Decarbonization Coalition,2 both launched in 2014, many institutional investors have moved quickly to understand the long-term portfolio implications of climate change and to adopt climate-risk management techniques.


Investing for the Long Run: ESG and Performance Drivers

Blog Post: We see a growing number of institutional investors seeking to avoid financial risks associated with environmental, social and governance (ESG) factors, or even to enhance returns by investing in companies that have strong ESG track records.

 

MSCI ESG Research LLC. is a Registered Investment Adviser under the Investment Adviser Act of 1940. The most recent SEC Form ADV filing, including Form ADV Part 2A, is available on the U.S. SEC’s website at www.adviserinfo.sec.gov.

ESG ADV 2A
ESG ADV 2B (brochure supplement)

 

Foundations of ESG Investing

Part 1: How ESG Affects Equity Valuation, Risk and Performance.

Energy, Utilities at Drought Risk

Linda-Eling Lee discusses on CNBC which industries are most at risk from a water shortage.

MSCI/Mercer ESG Breakfast Seminar Series

ESG 101: Connecting the dots on ESG and performance.
We invite you to join us for a breakfast seminar series, co-hosted by Mercer, where we will discuss the ESG trends to watch for 2018.