Our analysis of ESG factor performance in 2022 suggests that time horizons, as well as specific sectors and regions, may be significant in assessing the return characteristics of ESG portfolios. 

While the energy crisis has boosted the energy sector overall, individual company performance has varied markedly. Our analysis shows that businesses with above-average strategies to manage a low-carbon transition outperformed.

Could equity managers have maintained their energy exposure during the sector’s recent outperformance while also reducing carbon emissions? We find that they could have lowered emissions but with some trade-offs during our study period. 

There have been several dynamics that have influenced climate-index performance in the third quarter and first nine months of 2022. We examine the impact of macroeconomic and financial conditions on risk, return and sectors. 

In this article published in the Journal of Financial Data Science, coauthors from MSCI and MIT develop and describe a data-driven system using AI tools to capture market perception and, in turn, group companies into peer clusters.