Is There Really No Evidence That ESG Strategies Outperform?
Commentary from Alex Edmans (London Business School) on Scientific Beta's study claiming that there is “no evidence that ESG strategies outperform” after controlling for risk (We actually included the study in last week's newsletter)
Certainly, the straw man needs to be attacked, because many people treated those studies as gospel – ESG skeptics were rubbing their hands in glee and claiming victory, and ESG advocates defensively alleging that the authors must have an ideological bias against ESG.
What the Scientific Beta study has highlighted is that we should not react to research based on emotion. We should apply the same scepticism to a study that reinforces our view of the world as one that contradicts it, and have the same openness to a study that finds an “inconvenient truth” to one that supports what we would like to be true. They should not have had to make this point, but it is valuable that they have.
Source: https://www.growthepie.net/is-there-really-no-evidence-that-esg-strategies-outperform/