EdenTree's Van Herwijnen: The investment obsession failing our economy

Financial materiality hampering prospects

Interest in responsible investing has grown significantly over the past decade and this has created a boom in new investing strategies.

Incorporation of environmental, social and governance (ESG) factors into investment and ownership decisions is increasingly at the forefront of this proliferation of new approaches.  As a result, there are now a number of service providers offering ESG rating and scoring systems to help fund managers analyse company's ESG credentials. However, there remains a lack of consensus on which ESG issues should be taken into account.  One increasing trend among responsible investors - and ESG rating service providers offering them a service - is to focus solely on financial materiality. ...