• Trends with Benefits

    ESG Performance with Mark Sloss

    Ed Lopez, Head of ETF Product

    A trend decades in the making

    In 2020, ESG’s time may have finally come. Investing based on environmental-, societal- and governance-oriented principles is a trend influencing fund development, government regulations and attracting investor fund flows. It can be a complicated topic, particularly if you’re trying to find the best approach. The good thing for investors is that there are a myriad of approaches to ESG investing. The bad thing for investors is that there are a myriad of approaches to ESG.

    Listen to Podcast

    Subscribe Now

    Apple Podcasts

    Apple Podcasts |

    Google Play

    Google Play |

    Spotify Spotify |

    Stitcher Stitcher|

    Sound Cloud SoundCloud

    ESG is a topic I love to hate. Not because of the intent of it, but more because many of the methodologies now in play try to distill seemingly subjective decisions into a “check-the-box” type of exercise. In some cases, good and responsible companies may be left out of a portfolio or, in other cases potential exclusions were missed. This summer, fashion company Boohoo made headlines when news broke that despite being given a high grade by many ESG ratings services, the company paid workers in its supply chain less than minimum wage and subjected them to unsafe working conditions.

    No methodology is perfect, whether trying to identify good ESG companies or good large-cap quality growth companies. Ultimately it comes down to understanding the methodology, its biases, and whether or not it aligns with your intent. I actually love the idea that investors are increasingly requiring that their investment dollars align with their values and if doing good doesn't materially impact returns, why shouldn't everyone do it?

    In 2020, ESG strategies generally have performed relatively well and record flows into ESG funds have followed. Performance, as I discuss with Mark, is also a complicated or at least nuanced topic. We discuss SRI (Socially Responsible Investing) the precursor to ESG and the long held perception of performance concessions with such values-based investing. I also discuss with him the relative importance of E, S and G in the total equation of things and ongoing efforts to standardize ESG metrics.

    Trend or Fad

    Listen for Mark’s take on single source coffee supply chains, stakeholder capitalism, and blockchain digital rights.

  • Important Disclosure

    For informational and advertising purposes only.

    This information originates from VanEck (Europe) GmbH which has been appointed as distributor of VanEck products in Europe by the Management Company VanEck Asset Management B.V., incorporated under Dutch law and registered with the Dutch Authority for the Financial Markets (AFM). VanEck (Europe) GmbH with registered address at Kreuznacher Str. 30, 60486 Frankfurt, Germany, is a financial services provider regulated by the Federal Financial Supervisory Authority in Germany (BaFin). The information is intended only to provide general and preliminary information to investors and shall not be construed as investment, legal or tax advice. VanEck (Europe) GmbH and its associated and affiliated companies (together “VanEck”) assume no liability with regards to any investment, divestment or retention decision taken by the investor on the basis of this information. The views and opinions expressed are those of the author(s) but not necessarily those of VanEck. Opinions are current as of the publication date and are subject to change with market conditions. Certain statements contained herein may constitute projections, forecasts and other forward looking statements, which do not reflect actual results. Information provided by third party sources are believed to be reliable and have not been independently verified for accuracy or completeness and cannot be guaranteed. All indices mentioned are measures of common market sectors and performance. It is not possible to invest directly in an index.

    All performance information is historical and is no guarantee of future results. Investing is subject to risk, including the possible loss of principal. You must read the Prospectus and KIID before investing.

    No part of this material may be reproduced in any form, or referred to in any other publication, without express written permission of VanEck.

    © VanEck (Europe) GmbH


  • Authored by

    Ed Lopez
    Head of ETF Product

    Explore My Insights