Many thanks to Alexandra Cain for including Director Eddie Barrett’s recent comments in her article: “Market awash with products to meet demand“:
Eddie Barrett, director of investment managers Alvia Asset Partners, says investors should be wary of research about ESG published by fund managers when the research serves their interests.
“There’s no independent arbiter or framework by which to vet ESG research, so reports that profess negative or positive ESG screening are highly subjective,” Barrett says. “That’s because assigning a business an ESG rating varies markedly across scoring systems.”
Barrett says it’s difficult to gauge whether companies with strong ESG policies perform better than companies without the same focus on how these elements shape their operations.
“Without a centralised body dictating what qualifies as pro-ESG, the market is being dictated to by the whimsy of well-fed PR machines, determined to greenwash some market players at the expense of others,” he says.
Barrett stresses that having strong ESG policies and actually implementing them are vastly different things.
“Companies with extensive ESG policies outlined in their annual report don’t always do a good job of managing ESG considerations across their operations. Equally, a company that does not publish may have always considered ESG as part of standard corporate policies and procedures.”
“Market awash with products to meet demand”, Alexandra Cain (AFR, Nov 17, 2021)