Establishing ESG Issues in Analysis

I am currently working with the of CFA Society of the UK Energy and Sustainable Investments special interests group to advocate the integration of ESG issues into investment analysis and aid in developing the standards and techniques for this form of valuation. Here is an excellent list of resources to aid in adapting these standards, provided for by the CFA Institute as they are beginning to recognize the increasing importance that non-financial factors plays in determining performance.

Why are ESG Issues Important?

* Analysts need to understand nonfinancial factors that affect the longer-term viability of companies
* Individual investors are increasingly calling on their financial advisers to take advantage of available ESG opportunities
* Companies that incorporate ESG exposures into long-term strategic planning will provide a more complete picture of their prospective value

Why is CFA Institute Interested?

* We’re charged with educating our members about current developments in the investment landscape and ESG issues are increasingly important factors in the markets
* Money managers and financial analysts who can interpret and relate ESG factors to a company’s future prospects may potentially develop a competitive advantage
* ESG-related disclosures can improve the transparency of the global capital markets through more thorough reporting of the long-term issues facing publicly traded companies
* The implementation of ESG reporting standards is in the early stages around the world, and we want to ensure that investors are aware of and involved in these efforts.