What is ESG Investing?
Analysts and advisors said that to put your money where your values are requires learning about the factors that lead an investment to get a high ESG rating.
ESG factors are generally considered to apply to companies’ current operations, explained Tracy Barba, director of venture and equity ethics.
The “socially responsible” investment philosophy is more sweeping and aims to encourage companies to think about big-picture impacts of aggregate decisions. “Impact investing,” said Barba, “drives change and doesn’t just reward change. You’re thinking through the potential outcomes of the investment.”
Barba says to remember that “ratings systems are based on self-disclosed information and what’s been deemed to be financially material.”
Tracy Barba, director of venture and equity ethics, quoted by CNN.