The Conference Board, ESGAUGE – Wednesday, April 24, 2019
The study by The Conference Board in partnership with ESG data-mining firm ESGAUGE, documents corporate governance trends and developments at 2,854 companies registered with the US Securities and Exchange Commission (SEC) that filed their proxy statement in the January 1 to November 1, 2018 period and, as of January 2018, were included in the Russell 3000 Index. The findings provide some important context to the current debate on gender diversity and board refreshment, underscoring the main reasons why progress remains slow. The study was developed with the support of the John L. Weinberg Center for Corporate Governance (successor of the Investor Responsibility Research Center Institute (IRRCi)), Debevoise & Plimpton and Russell Reynolds Associates.
The New York University Stern Center for Sustainable Business – Thursday, January 31, 2019
The Stern CSB and its project partners sought to engage companies on the topic of integrating quarterly conference calls. The Stern CSB convened a workshop attended by sustainability, investor relations and communication professionals from participating companies and other companies with an interest in integrated quarterly calls. The aims of the workshop were to: 1) Help companies increase the inclusion of the financial impact of successful execution of long-term and ESG strategy, in quarterly earnings content; 2) Increase collaboration between Investor Relations, Finance and Sustainability teams in crafting strategic communications on long-term and ESG strategy and the impact that successful execution of ESG strategy has on corporate financial performance; 3) Create a coalition of companies working together to overcome barriers to the inclusion of information on corporate financial performance related to ESG in quarterly earnings content.
Anthony C. Ng, Zabihollah Rezaee – Thursday, December 6, 2018
This research is authored by Zabihollah Rezaee, Professor, School of Accountancy, University of Memphis and Anthony C. Ng, Deakin University, Australia. It was selected for Honorable Mention recognition for the 2018 IRRCi annual investor research competition.
This research investigates whether the financial market prices business sustainability factors by examining the association between the stock price informativeness and sustainability factors of performance and disclosure. It finds that non-financial environmental, social and governance (ESG) sustainability performance is positively associated with stock price informativeness after controlling for financial economic performance, using a sample of 18,223 firm-year observations between 1992 and 2015.
Lucian Bebchuk, Scott Hirst – Thursday, December 6, 2018
Index Funds and the Future of Corporate Governance: Theory, Evidence and Policy, is co-authored by Lucian Bebchuk, James Barr Ames Professor of Law, Economics, and Finance, and Director of the Program on Corporate Governance, Harvard Law School and Scott Hirst, Associate Professor, Boston University School of Law and Research Director, Program on Institutional Investors, Harvard Law School. It is the academic winner of the 2018 IRRCi investor research competition. This paper studies the resources and decisions of index fund managers — how they monitor, vote and engage with their portfolio companies. This research provides an analytical framework for understanding the incentives of index fund managers, provides the first comprehensive and detailed empirical account of the full range of stewardship activities that index fund managers do and do not undertake, and considers the significant policy implications of the issues analyzed.
Antti Savilaakso, Larry Abele – Thursday, December 6, 2018
Measuring the Sustainability Impact of 25 European ESG Funds, is co-authored by Larry Abele and Antti Savilaakso, both with Auriel Investors. It is the practitioner winner of the 2018 IRRCi investor research competition. This research introduces a new quantitative data-driven model to measure the level of sustainable investments in a portfolio as compared against a benchmark by creating a measure called “active ESG (environmental, social and governance) share” intended to quantify the impact of sustainability considerations on the portfolio’s holdings. The research then compares the active ESG share of 25 diversified European ESG funds. It finds that these funds prioritize the provision of environmentally and socially positive products and services by their portfolio companies, but have lower board independence, gender equality and social impacts than their benchmark. In general, the funds had an active ESG share of only four to five percent, meaning that sustainability issues only caused a four to five percent holding differential from a portfolio that did not consider sustainability.
Heidi Welsh, Sol Kwon – Wednesday, November 14, 2018
This report finds that large public company sustainability reporting is maturing rapidly, with financial data presented alongside growing social and environmental metrics and quantified goals. It also finds that despite investor interest, most companies in the S&P 500 have not adopted fully integrated corporate reporting, a new report reveals. “State of Sustainability and Integrated Reporting 2018” was commissioned by the Investor Research Responsibility Center Institute and authored by the Sustainable Investments Institute (Si2).