Benchmark-beaters: how ESG gives indexers active power

Benchmark-beaters: how ESG gives indexers active power
The jury is still out on whether ESG investment has led to a better world. (Image: Getty)
David Chaplin
The environmental, social and governance movement could destroy passive investing.A new report from Create, a UK-based specialist research house, highlights how the new “granularity” of ESG investing has seen indexers slice and dice benchmarks into infinitesimally different versions that it might as well be active management.“As innovation is moving to ever-narrower indices, this ultimately results in active decision-making that mimics active stock picking,” the Create study says. “This applies especially to those...

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