Environmental, social and governance (ESG) research measures corporate performance across factors such as resource efficiency, pollution and waste management, corporate governance, product safety, and workplace quality.
While traditional sources of data such as financial statements remain important, today there is a new trove to mine. Increasing corporate transparency and disclosure, combined with a growing research field that quantifies and measures corporate ESG data, provides investors with the opportunity to evaluate companies across a more complete set of information to more fully reveal corporate risks and opportunities.
Hundreds of independent studies show that companies performing well on ESG measures also produce superior financial returns.1,2 The phenomenon is well-documented in two meta-studies. Both concluded that companies with strong ESG performance exhibited a lower cost of capital, higher profitability, and stronger share performance.
Through a rigorous academic analysis and empirical approach, we have identified material ESG factors that are positively correlated with performance and increased ROIC. Our research indicated that the financial materiality of ESG factors differ by sector and geography. We then created the BlueSky ESG Roadmaps™, which maps the financially material ESG factors that are unique to each sector and region.
BlueSky ESG Roadmaps™
- The growing body of ESG data is dominated largely by immaterial information
- BlueSky only integrates financially material ESG data that adds value to our process
- Over 18 months of empirical research prior to launch drives our focus on the material ESG factors for each sector and geographic region
- Over 40 unique BlueSky ESG Roadmaps™.
1 Clark G.L., Feiner, A. and Viehs, M. (2014) “From the Stockholder to the Stakeholder” University of Oxford and Arabesque Partners. 2 Fulton, M. and Kahn, B. (2012) “Sustainable Investing” DB Climate Change Advisors.