What is ESG?
ESG stands for Environmental, Social and Governance. There is growing evidence that suggests that ESG factors, when integrated into investment analysis and portfolio construction, may offer investors potential long-term performance advantages. ESG has become shorthand for investment methodologies that embrace ESG or sustainability factors as a means of helping to identify companies with superior business models.
ESG factors offer portfolio managers added insight into the quality of a company’s management, culture, risk profile and other characteristics. By adding this increased level of scrutiny associated with ESG analysis, Pax World seeks to identify companies that:
- Are leaders in their industries
- Are better managed and are more forward-thinking
- Are better at anticipating and mitigating risk
- Meet positive standards of corporate responsibility
- Are focused on the long term