One of the many criticisms you can make of ESG as an investment criteria is that it makes no consideration at all for whether the state that the company is based/operates in is a democracy. Or perhaps for western companies whether it actively engages in shadow money that undermines democracy. That may sound fine if you want to save the planet but it's really not I think, not least as it invariably means the society in question lacks the transparency and accountability to actually achieve environmental outcomes - the planet is not an authoritarian system.
That would admittedly be incredibly difficult to do but there's no fucking way you can call investing in a company based in an authoritarian dictatorship a sensible ESG investment. It's not making the world a better place, you're making it worse but think it's okay because there's a smiley face on the monitor. All the air in this debate on ESG is unfortunately sucked out by nonsense from morons like Ron DeSantis but there really is an argument that I feel we've surrendered in the west that our concept of democracy and the institutions that underpin it should matter.
You might call me a plant looking to brainwash the innocent minds of .gs users but equally the corporate deep-state's own approach of shifting investment from China to India and Vietnam doesn't address this at all. Even applying realpolitik thinking to this it's blatantly just creating the same problem down the road we face with China. It's the meme about the US funding the people who eventually bomb it on steroids.
The solution to this is for investors to have better demands on where they put their money, it's on politicians to realise the soft-power benefits of directing investors money to states not actively trying to undermine the UK and for investment monoliths themselves to stop and think that maybe the correlation between 'emerging economy' and 'repressive shithole' isn't a coincidence. That might lead to a portfolio heavy in developed western economies but I'm unsure if divesting from liberal democracies isn't the dumbest move possible from a profit and a global good perspective. There are democracies outside the general umbrella of the west - e.g. Costa Rica, Botswana but best of luck finding the ETF and ones that are vaguely western camp but also backsliding e.g. Hungary, Turkey.
I don't know I just thought I'd rant about this. ESG is a joke.
Evil is lucrative, and when it comes to investment, that's what the free market demands. I would love to invest my money in random shitholes to help grow their economies, but the only shitholes I can invest in are the genocidal Chinese and the street-shitting, acid-throwing, gang-raping Indians. I've heard that Kyrgyzstan is a relative beacon of human rights and freedom for that part of the world, but I can't help fund startups there because no other investor will touch it plus it really is very corrupt and they do have that bride-kidnapping thing.
If you're really, really, really rich and good at financial stuff, you could probably set up your own fund, solely in the stock markets of emerging liberal democracies around the world. There are already such things for "green" and "ethical" investing. But again, evil is lucrative and that's why there's so much of it. Go ahead and invest in an ethical fund and have fun getting minuscule dividends from hipster porridge companies instead of rolling in oil and tobacco money.
>>9746 >Go ahead and invest in an ethical fund and have fun getting minuscule dividends from hipster porridge companies instead of rolling in oil and tobacco money.
Both China and India underperformed over 2022 and that doesn't look like it's going to change anytime soon. And god help you if you ever invested in Russia.
This stuff isn't lucrative, it's viewed as such because they have room to grow but that doesn't mean they will or that the risk justifies it. The majority of the largest companies in the world are still in the West and the majority of innovation still emerges in the west. You're painting nonsense.
>>9748 Why are you talking about ESG when the OP is specifically attacking ESG ratings? Why are you saying Shell is 'anti-ESG' when it consistently strikes a strong ESG score?
In fact if you look at some of the best performers over the past year they will have strong ESG scores despite a lot of them being very, very evil. Take a look.
https://www.knowesg.com/company-esg-ratings
>>9749 >Why are you saying Shell is 'anti-ESG' when it consistently strikes a strong ESG score?
Any ESG model that results in Shell achieving good scores is fundamentally broken. On the one hand, they're not Trafigura, but on the other, they are Shell.
