Valuing Environmental, Social and Governance Performance

The new year is well underway and companies are preparing to report fourth-quarter earnings. However, increasingly the focus is not just on financial performance. More and more, environmental, social, and governance factors are taken into account by investors, and there’s proof that these factors are well worth considering. ESG factors don’t just evidence good corporate citizenship, they help to identify strong, sustainable business.

For proof, check out Barron’s look at The Evolution of ESG Investing along with its ranking of mutual funds with the most sustainable performance. Note that Morningstar’s sustainability metric beat the S&P 500 last year a survey by Barron’s of the funds in Morningstar’s database found that “stockpickers who gravitated toward sustainable companies beat the broad market in 2018, just as they did in 2016 and 2017.” Not to mention firms like Parnassus Investments, pioneers in value investing, have consistently returned market-beating numbers over the past decade.

Precise Write has helped companies develop a sustainability strategy and put together sustainability and corporate citizenship reports. Some of the questions we’ve helped companies answer include what sustainability means to their business; what is their approach to transparency; and what can be learned from a deeper understanding of materiality – what matters most to stakeholders and the business. Precise Write also helps companies with CEO letters for sustainability and citizenship reports as well as forums like the Business Sustainability Roundtable.