March Market Insights

This month’s article from our partners at Fiducient Advisors takes a hard look at the gray areas that exist in the green thinking behind Environmental, Social, and Governance (ESG) investing. In a space that’s prone to strong — and differing — opinions on right vs. wrong, it’s important to remember that the truth is often somewhere in the middle, and investors should always proceed with caution and common sense. Here are some key points covered in the report:

• Data around ESG investing is there, but it’s largely self-reported, unregulated, and unaudited, making determining value complicated

• Better standards and oversight are in the works, thanks to the newly formed Value Reporting Foundation and its partnership with the International Financial Reporting Standards Foundation

• Guidelines have been proposed to help improve standards of disclosure and transparency among public companies concerning ESG

• ESG scoring still has a ways to go before it becomes reliable and is still inconsistent at best, meaning investors would be wise to tread carefully

• Nothing can be solved overnight, but there is a path forward for ESG investing in portfolios

Download your copy of the article here.