Originally Posted by
bundabergdevil
Originally, the ESG activism was confined to values-based investments whether that was a catholic pension fund screening out guns, porn and liquor or another ethical/value system.
The big boys are starting to develop their own investment vehicles because the market for such products is growing and there is defensible research that suggests companies with strong ESG management practices outperform their peers without them. So, it’s just another investment thesis.
But, the bigger conversation is about expanding the scope of what constitutes material information for investors. The long-term, passively managed money increasingly believes ESG info is material and that companies out of step with certain social and environmental changes are at risk.
Four or five years ago I started staffing calls with IR because Blackrock, State Street, CalPers and others were bringing ESG analysts to the reviews and asking questions. Up to that point, I had only interacted with the SRIs. I can tell you that IR was shocked the first time State Street told them that they would be voting against management’s recommendation on one of these proposals.
I’m still surprised by the DuPont vote. That is overwhelming and history making.