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“Ultimately, incentive structures and systems drive ESG investing, which can be disingenuous. Structurally, public market investors continue to focus on the incentives which maximize their financial returns, even while taking certain ESG inputs into account in their portfolio allocations. Only by regulating and incentivizing the actual outcomes might investors alter their investment strategies towards new rewards based on ESG outputs.” — Roger Spitz
Ultimately, incentive structures and systems drive ESG investing, which can be disingenuous. Structurally, public market investors continue to focus on the incentives which maximize their financial returns, even while taking certain ESG inputs into account in their portfolio allocations. Only by regulating and incentivizing the actual outcomes might investors alter their investment strategies towards new rewards based on ESG outputs.