I have been urging people to look at better investments for the past 15 years and finally the theory has been tested. Would Environmental, Social and Governance (ESG) investments do better in a crisis?
Yes, they did.
Most of the good performance has come by always adhering to Environmental, Social and Governance standards (ESG).
I know that my clients and most other investors understand the benefit to the environment and society. What I do not know is if other investors and their advisers understand that a fundamental change has already taken place.
The changes will continue, and it is going to be difficult to spot the difference between ‘greenwash’ and the real deal, now that the flood gates have opened.
The shift started during the financial crisis a decade ago. At the time I was asked to comment on BBC Bristol Radio on Ethical investing.
My strongest memory is of the journalist who expressed disbelief that it was possible to question your adviser, bank, or pension manager about the assets they held.
For my part, the idea that you hand over your savings without understanding what it was financing was unacceptable and contributed to the financial crash.
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