The problem with ESG scores

Asset flows into sustainable investment funds reached record highs in 2021, amid growing concerns about climate change and societal issues. This should be great news, as more capital should, in theory, be channelled into more sustainable companies. However, this may not necessarily be the case, as not all sustainability funds are created equal, and greenwashing remains a critical problem. So, how can investors distinguish between funds that are leading the way in sustainability and those that are simply joining the latest bandwagon? One of the key areas that investors should watch ou...