ESG Point-Counterpoint

Many employees and active investors increasingly insist that the companies in which they invest and/or for which they work make socially responsible choices.  In addition to being good stewards of the environment, these businesses are expected to treat employees well, create healthy products and services and contribute to the greater good in meaningful ways.  For these individuals, investing is not just about turning a profit or growing one’s nest egg…. it is about building and thriving responsibly and sustainably.

Conversely, others hold fast to the belief that when a corporation or individual limits their investment options and potentially pays more to invest in companies that emphasize social and ethical responsibility, they sacrifice return on investment.  They argue that the primary incentive for investment is obtaining the highest return possible. The thinking of this constituency: when socially responsible investing becomes the primary objects, the financial side of the equation will suffer – at least part of the time.

Has the ESG initiative become too broad and restrictive…. or does it bring important, long overlooked issues to the forefront?