The Evolution of ESG Investing

ESG investing is growing exponentially as more investors and issuers utilize ESG and climate data and tools to support their investment decision-making. The practice of ESG investing began in the 1960s as socially responsible investing, with investors excluding stocks or entire industries from their portfolios based on business activities such as tobacco production or involvement in the South African apartheid regime.

Today, ethical considerations and alignment with values remain common motivations of many ESG investors but the field has expanded to consider financial materiality as well. Many investors now look to incorporate ESG factors into the investment process alongside traditional financial analysis.

ESG Ratings aim to provide an assessment of the long-term resilience of companies to ESG issues through the industry-specific evaluation of key ESG risks and opportunities.

Explore MSCI ESG Research’s Key Issue Hierarchy below

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