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ESG scores could be standardized, reflect corporate responsibility rather than risk, and not be composite scores

By Hicbd
Fri Jan 14 2022 2:43 pm

"To compute a company’s ESG score, ratings firms score every company on a variety of ESG factors and assign weights to each of these factors, aggregating the results into a composite ESG score...It is subject to human judgment and inconsistent access to ESG information, making for tremendous variability across raters. But more detrimentally, it permits companies to achieve high composite scores even if they cause significant harm to one or more stakeholders but do well on all other parameters."

URL:
https://ssir.org/articles/entry/the_world_may_be_better_off_without_esg_investing
https://ssir.org/up_for_debate/article/how_investors_can_and_cant_create_social_value

URL Credit

Categories:
Corporate Social Responsibility (CSR) / Sustainability / Impact Investing / Portfolio Management Environmental, Social, and Corporate Governance (ESG) ESG / Socially Responsible Investing

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