PT  - JOURNAL ARTICLE
AU  - Edward N. W. Aw
AU  - Cristina Carroll
AU  - John Q. Jiang
AU  - Gregory Y. Sivin
TI  - Beyond a Morality Tale: Reassessing ESG Investing
AID  - 10.3905/jwm.2022.1.171
DP  - 2022 Apr 07
TA  - The Journal of Wealth Management
PG  - jwm.2022.1.171
4099  - https://pm-research.com/content/early/2022/04/07/jwm.2022.1.171.short
4100  - https://pm-research.com/content/early/2022/04/07/jwm.2022.1.171.full
AB  - We examined the benefit of incorporating ESG factors over a more recent period to acknowledge the ongoing investment trend towards ESG. A review of academic literature suggests lack of consensus on the benefit of incorporating ESG factors. We find no evidence that suggests incorporating ESG criteria results in a performance headwind or subordinate return. Furthermore, we find strong evidence of idiosyncratic risk reduction as one moves from firms that are least ESG compliant towards firms that are most ESG compliant. Finally, we conclude that the source of ESG rating can alter the performance of ESG factors.