Gustavo Bernal Torres
Short-sellers step up scrutiny of ESG stocks
FT reports: As the demand for ESG compliant assets increase investors need to be more aware of the quality of the asset as well as the value of the asset-
"As interest in ESG has surged, they have been on the prowl, looking for companies where investors have overlooked flaws and fraud in the rush to gain exposure to a technology or sector."
Shorts are important in the ESG space because it is so “white-hot” right now, says Rob Furdak, chief investment officer for ESG of Man Group, a hedge fund. “People are looking for any kind of sustainable angle and want to jump on the bandwagon when they see the potential for these new technologies to really be game-changers,” he says.
However, there are some who see short sellers doing more harm than good. Hiro Mizuno, the former head of the world’s largest pension fund, stopped lending out securities from the Japanese scheme last year because he believed shorting was antithetical to his mission of long-term value creation.