How to integrate the ESG dimension: incorporation vs. mix up

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Presented by

Erik Christiansen, ESG & Low Carbon Specialist; Felix Goltz, PhD, Research Director, Scientific Beta; Brendan Maton, IPE

About this talk

Proponents of ESG mixing strategies – i.e. so-called ESG integration strategies whereby ESG data and analysis are mixed with traditional financial inputs in the portfolio construction process – often claim that such an approach provides for the best results for ESG investors. We will take a closer look at such mixing strategies and underline several shortcomings. Topics covered include: • Analysing ESG strategies that mix ESG data with market data and/or traditional risk factors such as value or momentum in their portfolio construction processes. • Compared with ESG Filtering, ESG “Reweighting” Techniques Lead to the Divestment of Companies with better ESG Credentials • Optimising in Relation to Weighted Average ESG Scores Seriously Undermines Engagement. • How ESG mixing can send the Wrong Message to Companies Speakers: • Erik Christiansen, ESG & Low Carbon Specialist, Scientific Beta • Felix Goltz, PhD, Research Director, Scientific Beta
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