The main reason ESG has declined is that even companies that have a negative impact on the environment can disguise themselves as environmentally friendly as long as they pay self-proclaimed environmentalists.
@@noumahn2855 My sense is that they could get away with neglecting the E as long as they virtue-signalled enough about the S. Like _"Sure, you burned down a rainforest, but that's okay because you posted plenty of Pride flags on Twitter."_
ESG came around in a period where many wealth/asset managers started realising they need to justify their fees with the raising popularity of passive etfs etc. Feels like ESG was a neat and trendy way of differentiation from other competitors.
Lol it was its Management and practical application, how to Value or evaluate something that doesn't have a clear worth or scale to it. It should've been ISO'ed as a standard from the beginning
@@HolloMatlala1ISO’ed as a standard? The standard is profit and loss. Maximize one minimize the other. All one needs to do is access and read the publicly available financial statements that publicly traded companies disclose. What is there to standardize, reading comprehension, or access to public disclosures?
@@Handle35667 to standardize the measuring and scoring of Dimensions and ESG score into 1x or 3 Separate ISO standard badges example E= ISO No:XXXX and S= ISO No:XXXX , G = ISO No:XXXXX that way companies can choose which ESG component they want to associate with for their services or Products. You are focused on ESG being used as a limiting tool I am focused on it being used as part of a Machine a Process and read my second comment after this one about linking ESG and comparing it to Profits by linking High ESG Scores = Low Taxes (Thus creating a list of All Tax Credits and incentives that somehow contribute to ESG), thus not re-inventing the wheel based on companies who want to reduce their corporate tax using ESG mechanism's that are clearly defined. Like avoid and reduce tax by having an energy policy or contributing to social issues and barriers, helping a community or helping a specific sector that governments wants traction in through tax credits. Until ESG is linked to AFS statements and Tax it won't have the neccesary teeth required to bite, but only used as desert for the main course being PROFITS
to standardize the measuring and scoring of Dimensions and ESG score into 1x or 3 Separate ISO standard badges example E= ISO No:XXXX and S= ISO No:XXXX , G = ISO No:XXXXX that way companies can choose which ESG component they want to associate with for their services or Products. You are focused on ESG being used as a limiting tool I am focused on it being used as part of a Machine a Process and read my second comment after this one about linking ESG and comparing it to Profits by linking High ESG Scores = Low Taxes (Thus creating a list of All Tax Credits and incentives that somehow contribute to ESG), thus not re-inventing the wheel based on companies who want to reduce their corporate tax using ESG mechanism's that are clearly defined. Like avoid and reduce tax by having an energy policy or contributing to social issues and barriers, helping a community or helping a specific sector that governments wants traction in through tax credits. Until ESG is linked to AFS statements and Tax it won't have the neccesary teeth required to bite, but only used as desert for the main course being PROFITS
@@HolloMatlala1 sure, link ESG to government subsidies and tax incentives. Government should definitely be in the business of picking winners and losers in the private sector. When subsidies and tax breaks aren’t enough we can criminalize non-compliance! A free market, unassisted by government regulation seems so inefficient right? How can capital even get allocated without the government’s guiding hand. In fact, a free market seems much less efficient than overt government control of the private sector. Have you considered running for office?
Man, I feel you. I used to run strategic marketing for large insurers, assets managers and fin serv, and first caught wind of what a crock ESG was back on 2017 when I had sell funds to retail and it made no sense on its face... been fighting it (and constructively criticising) since then.
@@MG2.5.4.It's kinda true, companies don't care about ESG, they don't care about being altruistic, they care about their bottom line, it's quite literally their job. If acquiring an ESG certificate increases their bottom line they will do so, if it doesn't then they won't. It's that simple, ESG is just another ideology commodified under capitalism and your being truly lied to if you think it's revolutionary, ESG is like green washing
@@tobyytlai True, ESG is a privatized index fund and this subject to the imperfect criteria of that private entity, there are ESG index funds that are representative of progressiveness and there are some that aren't, with oil companies in them, etc. Of course if this ever catches on, these unsustainable companies will try their best to appear on these funds like they do now. The idea and concept itself is relatively good, obviously it's not the most profitable index fund but if you want to invest more responsibly then that's what it's predominantly for.
Man, Nicolai Tangen is everywhere nowadays! Glad to see a fellow Norwegian with good values and a good mind talk about important issues and developments in world economics!
17:11, he’s basically saying that his company is collecting a lot of data, hoping that one day a correlation with stock performance can be found that can help investors make better informed decisions. 20:23 “You need to care about diversity at board level because those boards with better diversity generally perform better.” Do-gooders love to make that claim. Are there any statistics about it? Better in what way even? The boards of Worldcom, Enron, Wirecard or Theranos were actually pretty diverse in terms of Gender, Nationalities, and so on, but I guess he's covering his statement by saying “generally”.
Lol it was its Management and practical application, how to Value or evaluate something that doesn't have a clear worth or scale to it. It should've been ISO'ed as a standard from the beginning
I mean the problem was green washing and no accountability for green washing, not ESG in itself, ESG "Fund" investing in terrible company without doing basic research on the actual company, just blindly following reports that are made by the company internal team and hoping to profit on the fad. Also, ESG is still very much everywhere in corporate financials and publications and website. It's just not working as a publicity stunt anymore. I expect smarter content from FT.
Aswath Damodaran, Prof at NYU, saw the red flags with ESG in 2020/21 when ESG investing was in vogue. The lady from DWS and the FT journalist mentioned some of the points that Damodaran highlighted in his blog posts on ESG. Lots of respect to the both of them for going against the grain and saying the truth at the risk of hurting their careers.
Regardless of what anyone thinks about ESG, everyone could still agree on the importance of investing in companies that make ethical decisions with strong corporate governance. It is all about managing risk. Unethical companies that have poor governance could pose a big liability for investors. Let's not forget that Meta was fined billions of dollars for breaching data privacy.
" Let's not forget that Meta was fined billions of dollars for breaching data privacy." Lmao more like they worked out they would come out ahead by just doing things their way and paying the fines if they got caught rather than doing things properly or ethically. The same is true of many other businesses
@@Gdsamplify It doesn't matter because Meta’s stock still took a big hit during that time anyways. I bet you wouldn't want to own Meta stock right before it was announced that they were charged billions of dollars in penalties for breaching data privacy. They also changed their name from Facebook to Meta because of Facebook’s bad reputation. Meta was very lucky that the data privacy laws were lagging very behind because of technology advancing too quickly. It is very likely that Meta would've been caught a lot sooner if the data privacy laws were up-to-date to reflect changes in technology. The Metaverse is also what’s saving their business. Maybe Meta wasn’t the best example, but there is always Enron anyways. No one could forget Enron and other companies like them.
@@matthewelisha8797Why wouldn't you want to own stock during that period? You'd love to own stock, you'd buy stock in fact, you do realize you're facilitating market speculation? Why should a company's stock price deteriorate heavily when they haven't actually changed their material condition? Sure, they got fined but they came out on top as a net benefactor.
@@Betweoxwitegan Yes, you are right. A rational person would buy the stock right after the crash happens. I know I would do it, but it still sucks for people who owned it before the crash, especially for short-term traders. If I was a long-term investor I would want stability. The problem is that Meta's reputation was already bad because no one likes Mark Zuckerberg (rightfully so), but the data privacy scandals worsened Meta's already bad reputation and it all happened at a time when Meta's growth remained stagnant due to them becoming a mature company, so to me investing in Meta was very risky at that time, even though I now know that my assumption was wrong because they are doing much better than I expected.
@@matthewelisha8797 Yeah, it depends on your jurisdiction, tax code and how long you've held the stock to determine if you should've sold before the stock crash and bought during the dip or not. I like ESG but it's not like it's doing much, it's green washing and a facade of corporate improvement to increase revenue, companies will only care about it as much as they profit from it which means it becomes corrupted by capital interest.
Must be republican. Such republican logic. Here's the thing ESG will be around whether the terminology changes, which I suspect it will, is another conversation.
The environmental or E part is relatively popular, even if implementation and greenwashing left a lot to be desired. The real issue was the S and G. HR departments started discriminatory hiring practices, company culture in many businesses became outright opressive. Cancel culture as its called was mostly that, tyranny by HR departments justified by saying DEI and ESG. Just buzzwords. It was all ideological.
Good video FT. As someone who is both realistic and pro-ESG, the video made it clear on both viewpoints. I agree that for longer horizon, esg should be taken into account. For asset management, it should focus on maximizing shareholder value. As mentioned in the video, greenwashing is putting esg backwards as well as the challenge in metholodogy used, but i am confident this would continue to grow and align in a singular direction in the future. As climate gets warmer, we will see new opportunities be brought up and thats where the asset managers can look to for new investments.
It's bewildering to watch, because too many voicing their opposition now are seemingly smart enough to have known this in 2021. There is obviously some groupthink / wise after the fact that can be applied, but not enough recognition of how craven people can be under the prevailing social narrative that created the fertile ground in the first place.
Because people used ESG as a tool for getting investment and started to showcase everything as ESG. It was never about sustainability but profit as usual.
A lot of people are just investing in Index tracking ETFs like Vanguard’s VTI. Most risk averse way to invest in the stock market and super low expense ratio compared to all the other funds out there.
I think the title is correct: the party is over. Meaning, we can go back to using ESG as a risk/return information and potentially avoidance od negative impacts (if done well). Further, sharpening the demands.towards public policy to change the rules of the game that their own goals (Paris) can be met. And then separate the positive impact aspiration in financial products from ESG very clearly.
Unlike Public Sector which it's main Core is managing Public and peoples money, It can easily be monitored and always be in the news for Public awareness and people's rights....Lol try exposing or publicizing private money it's a different story. Imagine offshore account holders having to lay bear their sources of funds and if they where accumulated through proper governance or Social means, absolute Chaos. it was supposed to have been ISO'ed as a standard and then Audited by Major Accounting Firms who can easily link each letter directly to the dollar.
ESG (formerly SRI) is always popular in bull markets. But when the proverbial sh*t hits the fan, nobody cares about it. It also attracts lots of the dead wood in finance, who have no business being in finance. The parasitic creatures in the sector who would ordinarily have considered an alternative career (basket weaving or teaching modern history or the classics at some stuffy college) suddenly found a way to become relevant and they dug in. ESG turned into a career saver for the mediocre in finance. A trendy buzz word to jazz up their flagging performance. It was a scam and like all scams, when the tide goes out those swimming naked can be seen in all their glory.
"How do we make losses mandatory in the short term?" -- ESG in a nutshell 🤣🤣🤣 The nerve of this guy, easy for him to say when it's other people's money.
great movie and everything is in it: in 5to 10 years... no one will pronounce anymore ESG as it will be the standards... "i will pick the product that is bringing less return at 4,5% showing efforts instead of taking the 6% return one to become the trend...as a long term investment". The party has just started!
It's a Norwegian governmental fund. They have been channelling oil revenues since the 90's into it to safeguard the money in the long-term, investing it in sustainable solutions and global securities
If we could use the $6trillions of oil subsides annually world wide to reinvest for clean energy, then petrol prices spike, but applied correctly the consumer is transitioned to new technology affordably.
Love the idea but it would take decades to build the infrastructure necessary to move from fossil fuels to sustainable energy across worldwide power grids. People would lose homes, retirement savings, and revolt long before you could finish.
Desiree is wrong. One bad experience and she's ruined sustainability potential of markets. And she's proud of it! And her point about pensions . You chose the fund that you want, no pension provider forces you into an ESG tracker . Laughable person
Unlike Public Sector which it's main Core is managing Public and peoples money, It can easily be monitored and always be in the news for Public awareness and people's rights....Lol try exposing or publicizing private money it's a different story. Imagine offshore account holders having to lay bear their sources of funds and if they where accumulated through proper governance or Social means, absolute Chaos. it was supposed to have been ISO'ed as a standard and then Audited by Major Accounting Firms who can easily link each letter directly to the dollar. Lol most silent partners and directors don't want their network and links exposed
😂 only the soft easy west is talking about ESG. The rest of the world doesnt have that luxury. Carbon based energy is still the most affordable reliable energy source for much of the world.
yeah, its also the west that cannot get rid of "fossil" fuel either, or just fuel actually, especially if everything must run on electricity. solar and wind are wreaking havoc on the grid, if they work, they also take up a large amount of space. nuclear is vilified for some reason. geothermal isn't drillable around the world, nor is everyplace dammable whats left? ESG and anything like it has never been about the environment, but amassing ever more materials and consolidating power as going green will take mountain ranges of material to achieve and who else but the ones who are pushing this royal court etiquette get to have a say in where it goes.
ESG was always doomed, but this is very shallow analysis. I thought FT had high standards.ESG's mistake was the "S", when you have S and then you're surprised its at the heart of the culture wars, you need help.
Oh the irony of the Norwegian Sovereign Wealth Fund hammering home the existential crisis of climate change, while in 2024 still reaping in Equinor ASA (Norwegian state oil & gas) krone.
The mistake was to try to do everything (E+S+G), in one go. No succesful campaign has succeeded without focus. The successful atmosphèric ozone protection campaign showed (shows) the way, in executing a wholesale global move away from CFC réfrigérant use. The focus also permitted effective enforcement. Of course, investors must get more active in the businesses in which they invest, and ensure that they are compliant with national regulations. It is a good thing that "ESG" as a brand for competitive advantage (a contradiction in itself) is dead. Everyone needs to be aligned, not just the marketing departments, with their empty greenwashing pronouncements, of a handful of MNEs.
I just checked, and my ESG mutual fund outperformed the various other hot trends of the time. Only a small portion of my portfolio is trying to predict zeitgeist.
Unlike Public Sector which it's main Core is managing Public and peoples money, It can easily be monitored and always be in the news for Public awareness and people's rights....Lol try exposing or publicizing private money it's a different story. Imagine offshore account holders having to lay bear their sources of funds and if they where accumulated through proper governance or Social means, absolute Chaos. it was supposed to have been ISO'ed as a standard and then Audited by Major Accounting Firms who can easily link each letter directly to the dollar.
Unlike many of commenters here, i feel ESG itself is not full of rubbish, but corporate companies were desperate to show some ESG action on paper and greenwash!
ESG is not fixing written off fossil investments leading to huge returns in these industries. ESG is a nice story to tell your investors to make another profit - companies in Europe adapting climate strategies because of carbon prices NOT because of ESG goals - it was and is just stupid marketing.
Its just a score to encourage investors to invest in companies that improve the environment Which should then encourage companies to improve the environment in other to get the investment companies dont actually really care about profit they care about what gives their shareholders maximum Returns on their investments that could be making the most amount of profit but for other companies that is also making the maximum of revenue being unprofitable as Amazon and uber did for many years he can also be avoiding scandals and having a perfect reputation as most people don't want to invest in "evil" companies all of these things can be seen as ways of maximising Returns ESG attempts to add itself to the list of things that maximise returns by improving your esg score you encourages esg investors which increases the value of your company therfore maximises returns for investors while improving the environment@@MG2.5.4.
ESG has evolved, has always been there even before the hype. It will continue stronger and with force. There will never be a turning back for the private markets.
Nice summary and perspectives. Luckily far-right does not seem to be part of the culprits, given your obsession with far-right parties😂. Thanks for the interesting documentary. Keep it up
Recall that it was Europe that decided to ban imports of Russian hydrocarbon fuels. In addition the Nordstream II pipeline ws destroyed by NATO-Ukranian interests. Thus its incorrect to blame Vladimir Putin for Europe's high energy prices.
Not surprised to hear the HSBC guy lost his job. There's a lot I disagree with in this film but nothing perplexed me more than his attitude. Why be the head of responsible investing if climate change is an issue you shrug off as relatively "immaterial"?
Cos he was one of the few not brainwashed and with a bit of courage to call a spade a spade. The Earth has been a lot warmer than this and just kept going for millions of years. Humans are great at adapting to any environment AND we have more and more technology to help out. There is zero reason to panic about the climate.
ESG is a scheme invented by the G7 countries to hold the development of the global south , only they didn't expect that China could beat them in their own games 😂
1:45 Norwegian sovereign wealth fund. 1.6 trillion dollars and 1.5% of all listed equities in the world. climate is a financial risk. 3:45 higher hydrocarbon prices just follows the Ukraine invasion. 5:25 having wars intervening with your pipelines. 8:15 BlackRock has certainly become less vobal around ESG. 9:50 of additional influence, i.e., other shareholders who follow what we do. 15:40 it was a matter of few weeks i got fired 幾週後我就被解雇了
It gave talentless people something to have meetings about for a few years….now it’s another three letter abbreviation, DEI….’Yah, like luterally, like todally guys, like we’re luterally like rolling out like our DEI roadmap guys?’ FFS.
"E" is just temporatily disrupted :D, S and G are also important in company performance though. it only depends on clients. consumers, shopper to change "E"
Where is the financial risk in being unethical? What is the definition of being ethical/unethical? Is breaking the law unethical? The largest and most profitable companies in the world (banks) in the most largest and most profitable industry (financial services) routinely break the law because the profit. ‘Unethical companies that have poor governance could pose a big liability for investors’. You are not a serious person with a serious brain and can’t be a serious investor to make such an idiotic statement. All of the data demonstrates that companies willing to break the law where the benefits outweighs the costs are more profitable than companies that follow the law where the costs outweighs the benefits. Reference all the major banks in the 2008 financial collapse. Or reference any industry-wide banking enforcement actions vs. revenue from the activity that precipitated the enforcement actions. Then reference the revenue, all the illegal business practices that suffers no expense for law-breaking because the laws simply go unenforced. People love to say that the SEC is in the pocket of the the industry, and whether this is true or not can be debated, but what is not debatable is that the SEC can only punish a small percentage of the law breakers, and the fines they levy usually leave a large profit margin. ESG is an ideology. A fiduciary using their moral ideology to grade companies as ethical/unethical is in breach of their fiduciary responsibility by weighting their investments to towards their arbitrary definition of ‘ethical’ Breaking the law is often profitable. Companies that find ways to break the law profitably will outperform companies that don’t. These are facts. These fiduciaries are selling a lie to line their own pockets. That lie is that these fiduciaries have developed ‘ESG’ criteria to maximize return on investment; give them your money. Hence ESG is in fact a marketing scam, perpetrated by fiduciaries to line their pockets. But I manage my own assets and my pension has out performed every managed pension fund on the planet so what do I know. LOL. I should pay them to manage my assets instead.
ESG is amazing, it's actually really powerful, I hope we can have people that fight for it but what they are talking of is not ESG, what they want to implement isn't ESG, what you are talking of is cost cutting using ESG as the marketing tool. ESG is damn expensive not a discount, for example all families that have a relative that has died from cancer might have a claim to go after all companies that created synthetic dyes and chemicals like pfas under esg, it's damn expensive, when they try reducing costs it's wrong. People misunderstanding Larry, that's why he talked of forcing behaviour and it will happen through shareholders so to my felow blackrock shareholders, vote, vote, vote, vote, participate in governance in every possible way
The price of food 😂. Who g.a.f about E.S.G when in real life right now bread is $5 a loaf 😂. In other words...The Planet is Fine....The People are fucked -George Carlin
13:03 a lot of oversimplification here which is incorrect. There’s research to show ESG investing can make same returns as regular investing. It does put pressure on companies to not greenwash and have ethical practices.
all this doc was about the "E" in ESG while the biggest backlash came mostly because of the "S" and the "G"
I hear you. But there's definitely a fair amount of backlash for E.
The main reason ESG has declined is that even companies that have a negative impact on the environment can disguise themselves as environmentally friendly as long as they pay self-proclaimed environmentalists.
No it's not it mentioned Wirecard
@@noumahn2855 My sense is that they could get away with neglecting the E as long as they virtue-signalled enough about the S. Like _"Sure, you burned down a rainforest, but that's okay because you posted plenty of Pride flags on Twitter."_
Yeah, poor journalism
ESG came around in a period where many wealth/asset managers started realising they need to justify their fees with the raising popularity of passive etfs etc. Feels like ESG was a neat and trendy way of differentiation from other competitors.
Profit & Loss realization has ended ESG
Lol it was its Management and practical application, how to Value or evaluate something that doesn't have a clear worth or scale to it. It should've been ISO'ed as a standard from the beginning
@@HolloMatlala1ISO’ed as a standard? The standard is profit and loss. Maximize one minimize the other. All one needs to do is access and read the publicly available financial statements that publicly traded companies disclose. What is there to standardize, reading comprehension, or access to public disclosures?
@@Handle35667 to standardize the measuring and scoring of Dimensions and ESG score into 1x or 3 Separate ISO standard badges example E= ISO No:XXXX and S= ISO No:XXXX , G = ISO No:XXXXX that way companies can choose which ESG component they want to associate with for their services or Products. You are focused on ESG being used as a limiting tool I am focused on it being used as part of a Machine a Process and read my second comment after this one about linking ESG and comparing it to Profits by linking High ESG Scores = Low Taxes (Thus creating a list of All Tax Credits and incentives that somehow contribute to ESG), thus not re-inventing the wheel based on companies who want to reduce their corporate tax using ESG mechanism's that are clearly defined. Like avoid and reduce tax by having an energy policy or contributing to social issues and barriers, helping a community or helping a specific sector that governments wants traction in through tax credits. Until ESG is linked to AFS statements and Tax it won't have the neccesary teeth required to bite, but only used as desert for the main course being PROFITS
to standardize the measuring and scoring of Dimensions and ESG score into 1x or 3 Separate ISO standard badges example E= ISO No:XXXX and S= ISO No:XXXX , G = ISO No:XXXXX that way companies can choose which ESG component they want to associate with for their services or Products. You are focused on ESG being used as a limiting tool I am focused on it being used as part of a Machine a Process and read my second comment after this one about linking ESG and comparing it to Profits by linking High ESG Scores = Low Taxes (Thus creating a list of All Tax Credits and incentives that somehow contribute to ESG), thus not re-inventing the wheel based on companies who want to reduce their corporate tax using ESG mechanism's that are clearly defined. Like avoid and reduce tax by having an energy policy or contributing to social issues and barriers, helping a community or helping a specific sector that governments wants traction in through tax credits. Until ESG is linked to AFS statements and Tax it won't have the neccesary teeth required to bite, but only used as desert for the main course being PROFITS
@@HolloMatlala1 sure, link ESG to government subsidies and tax incentives. Government should definitely be in the business of picking winners and losers in the private sector. When subsidies and tax breaks aren’t enough we can criminalize non-compliance!
A free market, unassisted by government regulation seems so inefficient right?
How can capital even get allocated without the government’s guiding hand. In fact, a free market seems much less efficient than overt government control of the private sector.
Have you considered running for office?
400 bps under par across the board did.
Not to mention giving Exxon a A rating while failing Tesla showed what a political joke ESG was.
Are you using sustainalytics rating to surmise for the whole industry? Imagine using hwangs example for HF
Tesla creates a lot of pollution. If you want E invest in public transport.
😳😳😳😳
Ideology got in the mix. Too much. I was let go from a ESG company for constructive criticism.
Man, I feel you. I used to run strategic marketing for large insurers, assets managers and fin serv, and first caught wind of what a crock ESG was back on 2017 when I had sell funds to retail and it made no sense on its face... been fighting it (and constructively criticising) since then.
S and G were always pure ideology. E less so but not too far off
ESG itself as it was already full of rubbish in the first place.
it hijacked your mind
I bet if I ask you what it is about you can’t explain.
@@MG2.5.4.It's kinda true, companies don't care about ESG, they don't care about being altruistic, they care about their bottom line, it's quite literally their job. If acquiring an ESG certificate increases their bottom line they will do so, if it doesn't then they won't. It's that simple, ESG is just another ideology commodified under capitalism and your being truly lied to if you think it's revolutionary, ESG is like green washing
ESG never had a real definition. It's designed to be as ambiguous as possible so that it couldn't be regulated
@@tobyytlai True, ESG is a privatized index fund and this subject to the imperfect criteria of that private entity, there are ESG index funds that are representative of progressiveness and there are some that aren't, with oil companies in them, etc. Of course if this ever catches on, these unsustainable companies will try their best to appear on these funds like they do now.
The idea and concept itself is relatively good, obviously it's not the most profitable index fund but if you want to invest more responsibly then that's what it's predominantly for.
Man, Nicolai Tangen is everywhere nowadays!
Glad to see a fellow Norwegian with good values and a good mind talk about important issues and developments in world economics!
so much fuff about ESG, utter rubbish imho. ESG is just paying someone to give you another "ribbon", complete waste of time.
17:11, he’s basically saying that his company is collecting a lot of data, hoping that one day a correlation with stock performance can be found that can help investors make better informed decisions.
20:23 “You need to care about diversity at board level because those boards with better diversity generally perform better.” Do-gooders love to make that claim. Are there any statistics about it? Better in what way even? The boards of Worldcom, Enron, Wirecard or Theranos were actually pretty diverse in terms of Gender, Nationalities, and so on, but I guess he's covering his statement by saying “generally”.
He's lying about diversity improving performance. He just knows what he is required to say.
Lol it was its Management and practical application, how to Value or evaluate something that doesn't have a clear worth or scale to it. It should've been ISO'ed as a standard from the beginning
“We have now realised” = “Now that certain people have made enough money we can now say” 😂
The guy talking about why his ratings company shouldn't be regulated is one of the most delusional rants I've ever seen
Would you like to regulate opinions?
@@phoenix5054 rubbish opinions deserved to called rubbish
ESG killed itself. Professor Damodaran perfectly said everything that was to be said about this marketing- political - financial chimera.
I mean the problem was green washing and no accountability for green washing, not ESG in itself, ESG "Fund" investing in terrible company without doing basic research on the actual company, just blindly following reports that are made by the company internal team and hoping to profit on the fad. Also, ESG is still very much everywhere in corporate financials and publications and website. It's just not working as a publicity stunt anymore. I expect smarter content from FT.
Aswath Damodaran, Prof at NYU, saw the red flags with ESG in 2020/21 when ESG investing was in vogue. The lady from DWS and the FT journalist mentioned some of the points that Damodaran highlighted in his blog posts on ESG. Lots of respect to the both of them for going against the grain and saying the truth at the risk of hurting their careers.
Agree. He's the most sane and logical voice on the topic. The collective effort that has gone into ignoring his better advice is astronomical.
Regardless of what anyone thinks about ESG, everyone could still agree on the importance of investing in companies that make ethical decisions with strong corporate governance. It is all about managing risk. Unethical companies that have poor governance could pose a big liability for investors. Let's not forget that Meta was fined billions of dollars for breaching data privacy.
" Let's not forget that Meta was fined billions of dollars for breaching data privacy."
Lmao more like they worked out they would come out ahead by just doing things their way and paying the fines if they got caught rather than doing things properly or ethically. The same is true of many other businesses
@@Gdsamplify It doesn't matter because Meta’s stock still took a big hit during that time anyways. I bet you wouldn't want to own Meta stock right before it was announced that they were charged billions of dollars in penalties for breaching data privacy. They also changed their name from Facebook to Meta because of Facebook’s bad reputation. Meta was very lucky that the data privacy laws were lagging very behind because of technology advancing too quickly. It is very likely that Meta would've been caught a lot sooner if the data privacy laws were up-to-date to reflect changes in technology. The Metaverse is also what’s saving their business. Maybe Meta wasn’t the best example, but there is always Enron anyways. No one could forget Enron and other companies like them.
@@matthewelisha8797Why wouldn't you want to own stock during that period? You'd love to own stock, you'd buy stock in fact, you do realize you're facilitating market speculation? Why should a company's stock price deteriorate heavily when they haven't actually changed their material condition? Sure, they got fined but they came out on top as a net benefactor.
@@Betweoxwitegan Yes, you are right. A rational person would buy the stock right after the crash happens. I know I would do it, but it still sucks for people who owned it before the crash, especially for short-term traders. If I was a long-term investor I would want stability. The problem is that Meta's reputation was already bad because no one likes Mark Zuckerberg (rightfully so), but the data privacy scandals worsened Meta's already bad reputation and it all happened at a time when Meta's growth remained stagnant due to them becoming a mature company, so to me investing in Meta was very risky at that time, even though I now know that my assumption was wrong because they are doing much better than I expected.
@@matthewelisha8797 Yeah, it depends on your jurisdiction, tax code and how long you've held the stock to determine if you should've sold before the stock crash and bought during the dip or not. I like ESG but it's not like it's doing much, it's green washing and a facade of corporate improvement to increase revenue, companies will only care about it as much as they profit from it which means it becomes corrupted by capital interest.
I work in a big european bank and yes ESG is a big marketing facade to look good
ESG was deeply unpopular to begin with. Forcing it down people's throats made it toxic. Cancelling people over it made it everyone's enemy.
I read your inanities in Slavoj Žižek voice
Must be republican. Such republican logic. Here's the thing ESG will be around whether the terminology changes, which I suspect it will, is another conversation.
The environmental or E part is relatively popular, even if implementation and greenwashing left a lot to be desired. The real issue was the S and G. HR departments started discriminatory hiring practices, company culture in many businesses became outright opressive. Cancel culture as its called was mostly that, tyranny by HR departments justified by saying DEI and ESG. Just buzzwords. It was all ideological.
Good video FT. As someone who is both realistic and pro-ESG, the video made it clear on both viewpoints. I agree that for longer horizon, esg should be taken into account. For asset management, it should focus on maximizing shareholder value. As mentioned in the video, greenwashing is putting esg backwards as well as the challenge in metholodogy used, but i am confident this would continue to grow and align in a singular direction in the future. As climate gets warmer, we will see new opportunities be brought up and thats where the asset managers can look to for new investments.
ESG or the fallacy of rich people that they have the power to change the Earth climate....
I believe it's called reality
It's bewildering to watch, because too many voicing their opposition now are seemingly smart enough to have known this in 2021. There is obviously some groupthink / wise after the fact that can be applied, but not enough recognition of how craven people can be under the prevailing social narrative that created the fertile ground in the first place.
ESG is gold-plated passed off as pure gold, practiced by those rich in poor values.
Excellent review from @SimonMundy and team
Because people used ESG as a tool for getting investment and started to showcase everything as ESG. It was never about sustainability but profit as usual.
ESG was like any other certification, it makes them feel good knowing deep inside its nothing but a sham
A lot of people are just investing in Index tracking ETFs like Vanguard’s VTI. Most risk averse way to invest in the stock market and super low expense ratio compared to all the other funds out there.
I think the title is correct: the party is over. Meaning, we can go back to using ESG as a risk/return information and potentially avoidance od negative impacts (if done well).
Further, sharpening the demands.towards public policy to change the rules of the game that their own goals (Paris) can be met.
And then separate the positive impact aspiration in financial products from ESG very clearly.
Unlike Public Sector which it's main Core is managing Public and peoples money, It can easily be monitored and always be in the news for Public awareness and people's rights....Lol try exposing or publicizing private money it's a different story. Imagine offshore account holders having to lay bear their sources of funds and if they where accumulated through proper governance or Social means, absolute Chaos. it was supposed to have been ISO'ed as a standard and then Audited by Major Accounting Firms who can easily link each letter directly to the dollar.
ESG (formerly SRI) is always popular in bull markets. But when the proverbial sh*t hits the fan, nobody cares about it. It also attracts lots of the dead wood in finance, who have no business being in finance. The parasitic creatures in the sector who would ordinarily have considered an alternative career (basket weaving or teaching modern history or the classics at some stuffy college) suddenly found a way to become relevant and they dug in. ESG turned into a career saver for the mediocre in finance. A trendy buzz word to jazz up their flagging performance. It was a scam and like all scams, when the tide goes out those swimming naked can be seen in all their glory.
"How do we make losses mandatory in the short term?" -- ESG in a nutshell 🤣🤣🤣 The nerve of this guy, easy for him to say when it's other people's money.
great movie and everything is in it: in 5to 10 years... no one will pronounce anymore ESG as it will be the standards... "i will pick the product that is bringing less return at 4,5% showing efforts instead of taking the 6% return one to become the trend...as a long term investment". The party has just started!
So why you ban BYD?
This is the story about humans in general. Our long term good intentions compete with our short term urgent needs or urges.
I’d really like to ask the Norges guy where the money for his fund came from, it was somehow left out of the discussion…
It's a Norwegian governmental fund. They have been channelling oil revenues since the 90's into it to safeguard the money in the long-term, investing it in sustainable solutions and global securities
Who would have thought that we were eventually going to reach this point? 😂😂
If we could use the $6trillions of oil subsides annually world wide to reinvest for clean energy, then petrol prices spike, but applied correctly the consumer is transitioned to new technology affordably.
Love the idea but it would take decades to build the infrastructure necessary to move from fossil fuels to sustainable energy across worldwide power grids. People would lose homes, retirement savings, and revolt long before you could finish.
Desiree is wrong. One bad experience and she's ruined sustainability potential of markets. And she's proud of it! And her point about pensions . You chose the fund that you want, no pension provider forces you into an ESG tracker . Laughable person
outstanding. loved it!
What killed ESG? Crap returns and/or major losses, basically.
Me listening to this while working in esg role. 😂
Same 😭😂🥲
Unlike Public Sector which it's main Core is managing Public and peoples money, It can easily be monitored and always be in the news for Public awareness and people's rights....Lol try exposing or publicizing private money it's a different story. Imagine offshore account holders having to lay bear their sources of funds and if they where accumulated through proper governance or Social means, absolute Chaos. it was supposed to have been ISO'ed as a standard and then Audited by Major Accounting Firms who can easily link each letter directly to the dollar.
Lol most silent partners and directors don't want their network and links exposed
😂 only the soft easy west is talking about ESG. The rest of the world doesnt have that luxury. Carbon based energy is still the most affordable reliable energy source for much of the world.
yeah, its also the west that cannot get rid of "fossil" fuel either, or just fuel actually, especially if everything must run on electricity.
solar and wind are wreaking havoc on the grid, if they work, they also take up a large amount of space.
nuclear is vilified for some reason.
geothermal isn't drillable around the world, nor is everyplace dammable
whats left?
ESG and anything like it has never been about the environment, but amassing ever more materials and consolidating power as going green will take mountain ranges of material to achieve and who else but the ones who are pushing this royal court etiquette get to have a say in where it goes.
There were so many statements made that were not factual around ESG and financial success it all became irrelevant.
Double standards and hypocrisy. EVs aren't clean
ESG has little to do with EVs. Bizarre.
100 facts
ESG was always doomed, but this is very shallow analysis. I thought FT had high standards.ESG's mistake was the "S", when you have S and then you're surprised its at the heart of the culture wars, you need help.
fake
Why was it always doomed? And at what point did you assess that?
Part of the S is not running sweat shops, not war profiteering, not using foreign slave or child labour
Because doing ESG was fkin expensive.
Shh your exposing the money but anyways yeah lol employment placement programs are the engines of our new globalized world
Companies are not the solution to anything good
A very nice analysis!!!
Oh the irony of the Norwegian Sovereign Wealth Fund hammering home the existential crisis of climate change, while in 2024 still reaping in Equinor ASA (Norwegian state oil & gas) krone.
For me the ESG party died inside me, when I was looking to invest in an esg etf s&p500 - and found McDonalds in the basket
The mistake was to try to do everything (E+S+G), in one go. No succesful campaign has succeeded without focus. The successful atmosphèric ozone protection campaign showed (shows) the way, in executing a wholesale global move away from CFC réfrigérant use. The focus also permitted effective enforcement. Of course, investors must get more active in the businesses in which they invest, and ensure that they are compliant with national regulations. It is a good thing that "ESG" as a brand for competitive advantage (a contradiction in itself) is dead. Everyone needs to be aligned, not just the marketing departments, with their empty greenwashing pronouncements, of a handful of MNEs.
Love you.. keep this upbig fan of your work
basically, when low interest rates remain for too long, it creates all kind of nonsense.
I just checked, and my ESG mutual fund outperformed the various other hot trends of the time.
Only a small portion of my portfolio is trying to predict zeitgeist.
Unlike Public Sector which it's main Core is managing Public and peoples money, It can easily be monitored and always be in the news for Public awareness and people's rights....Lol try exposing or publicizing private money it's a different story. Imagine offshore account holders having to lay bear their sources of funds and if they where accumulated through proper governance or Social means, absolute Chaos. it was supposed to have been ISO'ed as a standard and then Audited by Major Accounting Firms who can easily link each letter directly to the dollar.
Unlike many of commenters here, i feel ESG itself is not full of rubbish, but corporate companies were desperate to show some ESG action on paper and greenwash!
Good definition of ESG starts at 19 mins...why not use it up in front to set the table fairly?
Interesting view of esg invest
ESG is not fixing written off fossil investments leading to huge returns in these industries. ESG is a nice story to tell your investors to make another profit - companies in Europe adapting climate strategies because of carbon prices NOT because of ESG goals - it was and is just stupid marketing.
Can you explain what how ESG works in practice?
Its just a score to encourage investors to invest in companies that improve the environment
Which should then encourage companies to improve the environment in other to get the investment
companies dont actually really care about profit they care about what gives their shareholders maximum Returns on their investments
that could be making the most amount of profit but for other companies that is also making the maximum of revenue being unprofitable as Amazon and uber did for many years he can also be avoiding scandals and having a perfect reputation as most people don't want to invest in "evil" companies all of these things can be seen as ways of maximising Returns
ESG attempts to add itself to the list of things that maximise returns
by improving your esg score you encourages esg investors which increases the value of your company therfore maximises returns for investors while improving the environment@@MG2.5.4.
ESG has evolved, has always been there even before the hype.
It will continue stronger and with force.
There will never be a turning back for the private markets.
What serious fund manager takes investment cues from Tucker Carlson?
They moved on to DEI. All great ideas but completely Frankensteined
Weird hit piece
It's just a liberal wish list. I don't want my investments to fund anything but lawful means of meeting profits, not ideology.
Focus on the G and the E and S will follow but well managed by a competent team of managers
Nice summary and perspectives. Luckily far-right does not seem to be part of the culprits, given your obsession with far-right parties😂. Thanks for the interesting documentary. Keep it up
Recall that it was Europe that decided to ban imports of Russian hydrocarbon fuels. In addition the Nordstream II pipeline ws destroyed by NATO-Ukranian interests. Thus its incorrect to blame Vladimir Putin for Europe's high energy prices.
Not surprised to hear the HSBC guy lost his job. There's a lot I disagree with in this film but nothing perplexed me more than his attitude. Why be the head of responsible investing if climate change is an issue you shrug off as relatively "immaterial"?
Cos he was one of the few not brainwashed and with a bit of courage to call a spade a spade. The Earth has been a lot warmer than this and just kept going for millions of years. Humans are great at adapting to any environment AND we have more and more technology to help out. There is zero reason to panic about the climate.
ESG is rebranded tripartism and corporatism is a tenant of Fascism
Desiree Fixler - crazy name, crazy gal!
The guy at 4:20 just kicked the chair right from under himself eh? 😂 He just said it did he not hear himself?!?!
ESG is a scheme invented by the G7 countries to hold the development of the global south , only they didn't expect that China could beat them in their own games 😂
*Who exposed the ESG lies?* Here, corrected the title for you
esg is marketing gag like greta is. funneling money in their own pockets. your fault when you invest in these gangsters
Yo, you know that are people like me who don't invest in buzzwords? And I think we do better in the long run.
好好睇，好正
I didn't even know it was sick :(
lol
ESG was the big career perspective for lazy, dope smoking hippies and middle class moms
1:45 Norwegian sovereign wealth fund. 1.6 trillion dollars and 1.5% of all listed equities in the world.
climate is a financial risk.
3:45 higher hydrocarbon prices just follows the Ukraine invasion.
5:25 having wars intervening with your pipelines.
8:15 BlackRock has certainly become less vobal around ESG.
9:50 of additional influence, i.e., other shareholders who follow what we do.
15:40 it was a matter of few weeks i got fired 幾週後我就被解雇了
European still having it
It gave talentless people something to have meetings about for a few years….now it’s another three letter abbreviation, DEI….’Yah, like luterally, like todally guys, like we’re luterally like rolling out like our DEI roadmap guys?’ FFS.
That thumbnail👏👏
Лавандос сам идёт тебе в руки)
In the end it is all about money is why….
Woke is broke
Common sense prevailed.
Reality
"E" is just temporatily disrupted :D, S and G are also important in company performance though. it only depends on clients. consumers, shopper to change "E"
ESG is not dead its just repackaged
Oh no!.... anyways...
ESG = Go woke get broke.
Where is the financial risk in being unethical? What is the definition of being ethical/unethical? Is breaking the law unethical? The largest and most profitable companies in the world (banks) in the most largest and most profitable industry (financial services) routinely break the law because the profit.
‘Unethical companies that have poor governance could pose a big liability for investors’.
You are not a serious person with a serious brain and can’t be a serious investor to make such an idiotic statement. All of the data demonstrates that companies willing to break the law where the benefits outweighs the costs are more profitable than companies that follow the law where the costs outweighs the benefits.
Reference all the major banks in the 2008 financial collapse. Or reference any industry-wide banking enforcement actions vs. revenue from the activity that precipitated the enforcement actions. Then reference the revenue, all the illegal business practices that suffers no expense for law-breaking because the laws simply go unenforced. People love to say that the SEC is in the pocket of the the industry, and whether this is true or not can be debated, but what is not debatable is that the SEC can only punish a small percentage of the law breakers, and the fines they levy usually leave a large profit margin.
ESG is an ideology. A fiduciary using their moral ideology to grade companies as ethical/unethical is in breach of their fiduciary responsibility by weighting their investments to towards their arbitrary definition of ‘ethical’
Breaking the law is often profitable. Companies that find ways to break the law profitably will outperform companies that don’t. These are facts.
These fiduciaries are selling a lie to line their own pockets. That lie is that these fiduciaries have developed ‘ESG’ criteria to maximize return on investment; give them your money. Hence ESG is in fact a marketing scam, perpetrated by fiduciaries to line their pockets.
But I manage my own assets and my pension has out performed every managed pension fund on the planet so what do I know.
LOL. I should pay them to manage my assets instead.
I like the Norwegian guy who squanders the money of all the people with his hippie investments
ESG is amazing, it's actually really powerful, I hope we can have people that fight for it but what they are talking of is not ESG, what they want to implement isn't ESG, what you are talking of is cost cutting using ESG as the marketing tool. ESG is damn expensive not a discount, for example all families that have a relative that has died from cancer might have a claim to go after all companies that created synthetic dyes and chemicals like pfas under esg, it's damn expensive, when they try reducing costs it's wrong. People misunderstanding Larry, that's why he talked of forcing behaviour and it will happen through shareholders so to my felow blackrock shareholders, vote, vote, vote, vote, participate in governance in every possible way
No it's not lmao. ESG is companies pretending to care so governments don't use laws and regulations to create real change
The price of food 😂. Who g.a.f about E.S.G when in real life right now bread is $5 a loaf 😂. In other words...The Planet is Fine....The People are fucked
-George Carlin
Am I the only one who noticed that we just wasted 21 Minutes and 49 Secs of our life on this shitty documentary?
irrational and hypocritical
The British accents are unbearable
they are actually widely loved!
the disingenuous reporting is epic in scale here.
Who or what is ESG? lol
13:03 a lot of oversimplification here which is incorrect. There’s research to show ESG investing can make same returns as regular investing. It does put pressure on companies to not greenwash and have ethical practices.