The Effect of ESG on a Global Fund Market - Integrating Environmental, Social and Governance (ESG) in the investment strategy: A Global Market Research

University essay from Göteborgs universitet/Institutionen för nationalekonomi med statistik

Abstract: This paper investigates the different performances of global funds when implementing an ESG-strategy during the period 2013 to 2018. Using the from Morningstar Direct, consisting of return, Morningstar Sustainability Rating, Morningstar Portfolio Sustainability Score, Portfolio Controversy level and Environmental-, Social-, and Governance- Score, we conduct the regression analysis using the Fama French Carhart model. This paper finds evidence that the performances of the global funds are negatively affected by ESG-strategies in the short run, which are consistent with some previous studies. However, a substantial amount of literature suggest that long term benefits of implementing ESG-strategy exceeds the costs. There is also literature suggesting ESG is a profitable investment since it is less risky, thus a risk-adjusted return would imply similar or higher returns. In the long run, ESG investments are profitable.

  AT THIS PAGE YOU CAN DOWNLOAD THE WHOLE ESSAY. (follow the link to the next page)