Mapping sustainable investing: Exploring ambiguities and consistencies among sustainable indices

Sustainable investing is perceived as a confusing black-box by many researchers, practitioners, and investors. Terminology, metrics, approaches, disclosure standards are quickly evolving, while the empirical evidence provides a growing number of mixed results. In this paper, we examine the composition, performance, and the risk-return profile of reference sustainable indices for the asset management industry, distinguishing between ethical and socially-responsible, faith-based, ESG and climate ones. Our findings reveal consistent investment trends across various sustainable indices, impacting their overall performance. Specifically, our analysis highlights a prevalent inclination towards large and growth-oriented companies, as well as a persistent focus on technology, financials, and commodity sectors. These results provide valuable insights for investors, asset managers, and index providers regarding the potential misalignment between an investment vehicle's labeling and its actual composition, and the implications this discrepancy might have on investors' expectations.

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Publication Details

Journal
Journal of Environmental Management
Published
2024-08-05
DOI
https://doi.org/10.1016/j.jenvman.2024.122081
Citations
11
Primary Topic
Corporate Social Responsibility Reporting
Type
article
Field-Weighted Citation Impact
6.10
Controls
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article

Mapping sustainable investing: Exploring ambiguities and consistencies among sustainable indices

Milena Migliavacca, Alberto Dreassi, Enrica Bolognesi, Andrea Paltrinieri
11 citations
Journal of Environmental Management
Corporate Social Responsibility Reporting
6.10
article

Mapping sustainable investing: Exploring ambiguities and consistencies among sustainable indices

Milena Migliavacca, Alberto Dreassi, Enrica Bolognesi, Andrea Paltrinieri
article en
11 citations

Abstract

Sustainable investing is perceived as a confusing black-box by many researchers, practitioners, and investors. Terminology, metrics, approaches, disclosure standards are quickly evolving, while the empirical evidence provides a growing number of mixed results. In this paper, we examine the composition, performance, and the risk-return profile of reference sustainable indices for the asset management industry, distinguishing between ethical and socially-responsible, faith-based, ESG and climate ones. Our findings reveal consistent investment trends across various sustainable indices, impacting their overall performance. Specifically, our analysis highlights a prevalent inclination towards large and growth-oriented companies, as well as a persistent focus on technology, financials, and commodity sectors. These results provide valuable insights for investors, asset managers, and index providers regarding the potential misalignment between an investment vehicle's labeling and its actual composition, and the implications this discrepancy might have on investors' expectations.

Journal of Environmental ManagementVol. 367
Università Cattolica del Sacro Cuore (IT), University of Udine (IT), University of Trieste (IT), University of the Sacred Heart (JP)
Openalex Percentile: Top 4%
Corporate Social Responsibility Reporting
6.10
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Mapping sustainable investing: Exploring ambiguities and consistencies among sustainable indices — Milena Migliavacca, Alberto Dreassi, et al. · Journal of Environmental Management (2024) | TGRS Research Map | TGRS