ESG: Not just for breakfast anymore!

The radio show, A Prairie Home Companion, used to have an advertisement (their sponsors were fictitious), "...carp, not just for breakfast anymore." Of course, the joke is who, but the very fringe and dedicated, would eat carp for breakfast in the first place.*

ESG: Environment, Social Justice, and Corporate Governance information is the focus of SRI, yet one must also practice investing with the fundamentals - EPS (earnings per share), dividends, growth, P/E (price to earnings ratio), etc. In other words, SRI is fundamental investing with additional ESG information taken into account.

Well, it turns out that ESG information is moving into the mainstream. It's available to all traders everywhere through various information services. One notable new ESG information provider is Bloomberg!

You may not know it, but almost every trader uses Bloomberg already. Bloomberg is THE dominant source for information about publicly traded companies. Bloomberg is adding ESG to their information service!

This means that with every trade you make, you can ask almost anyone you are working with if they have considered the ESG information provided by Bloomberg.

What else does this mean?
It's a recognition that capital markets are beginning to take ESG information seriously, which means there is an advantage to paying attention to ESG from a purely financial perspective. Joe Keefe, CEO of PAX, explained that ESG represents valid intangible information. The intangibles, intellectual property, human capital, and competitive advantage are already viewed as valid and often very important. Seems like if a company is not treating it's workers fairly that it would pertain to human capital concerns.

ESG represents a competitive advantage for the investor that uses it. By allowing for broad areas of information, previously thought to be unrelated to business performance, the SRI investor has an advantage over the investor who overlooks ESG.

ESG, it's not just for breakfast anymore!

* with due respect to Minnesota fisherman