ESG Investing For Dummies (For Dummies (Business and Personal Finance)) by Brendan Bradley

1

 Getting to 
Know ESG

IN THIS PART . . .
 Discover how ESG investing isn’t to be confused with 
socially responsible, ethical, or impact investing.
 Understand what has driven the evolution and major 
growth in ESG investing in recent years.
 Run through the reasons why ESG is important, what the 
criteria for ESG ratings and metrics are, and what a 
company needs to do to enhance its ESG score.
 Investigate the key material indicators and risks for each 
aspect of ESG: environmental, social, and governance.
 Identify concerns around “greenwashing,” given the 
surge in ESG investments.

 IN THIS CHAPTER
 »Introducing the basic features of the 
ESG landscape
 »Defining what ESG is and isn’t
 »Looking at ESG’s effects on the 
environment, society, and 
governance
 »Using international norms to figure 
out ESG goals

 Chapter 1
 Entering the World of 
ESG Investing

 The acronym ESG has undoubtedly become one of the hottest topics in 
investment management in recent years. Google searches for the term “ESG 
investing” have grown exponentially in the last three years, so it’s certainly 
caught people’s attention! (Don’t believe me? Just look at Figure 1-1.) As a result, 
executive management has a range of new stewardship topics to contend with, 
now that global warming issues have created ‘E’nvironmental concerns, and the 
COVID-19 pandemic has further highlighted ‘S’ocial issues. (Corporate 
‘G’overnance issues have always been closely monitored by the investment 
community.)
 But what’s all the fuss about? Is ESG investing a passing fad or a long-term trend 
that will dominate investment management for the foreseeable future? This chap
ter looks at the fundamentals behind ESG investing, highlights some of the key 
drivers behind it, and identifies some of the goals and standards that have been 
established.

ESG Investing For Dummies (For Dummies (Business and Personal Finance)) by Brendan Bradley