HomeRI ResourceRefinitivWhite Paper: ESG vs. Financial Performance
Research and White Paper

Sustainable investing is a lasting trend in modern investment management, tomorrow's investors are more committed to sustainability and make more environmentally aware choices. While the intentions of investors are clear, incorporating sustainability in investment management remains controversial.

Our recently commissioned analysis by Probability & Partners investigates the relationship between Refinitiv ESG scores for large cap firms and their financial performance.

Using a robust panel data methodology and an extensive dataset spanning over 2,000 companies and 9 years, the white paper focuses on how stock returns, market value and volatility of firms in 4 regions (EU, U.S., Australia and Asia) are related to their ESG performance.

The quant analysts place ESG in the framework of well-known statistical models that aim to explain a firm’s stock returns as a function of many variables, such as firm’s size and its financial ratios. We also investigate how the ESG data quality differs per region and reporting period, and how financial characteristics other than stock returns are related to ESG scores.

CATEGORIES: Governance Governance: Corporate reporting