ESG dissection of European equities
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An empirical analysis of ESG factors and pillars and the implications for European equity markets.
Responsible investing has gained significant traction over the past decade, with environmental, social and governance (ESG) factors attracting greater attention2 . ESG scoring systems enable investors to examine these aspects when making investment decisions. While some aspects of the data available need improving3 , there is a broad agreement that the evolution of these tools is continually getting better. ESG investing is continuing to gain prominence and an increasing demand for ESG investments appears to be outstripping supply4 . ESG principles require regulation, and certainly Europe seems to be ahead of the curve on this front (Exhibit 1)