“Fund Transparency: Exploring the ESG Quality of Fund Holdings” – MSCI – March 31, 2016


In March 2016 MSCI published a research paper entitled, “Fund Transparency:  Exploring the ESG Quality of Fund Holdings.”

The executive summary explains: “MSCI ESG Research is introducing the concept of ESG Quality with the calculation of a Fund ESG Quality Score across over 21,000 mutual funds and ETFs. Funds with higher scores are comprised of companies managing their ESG risks relative to industry peers.”

Key findings of the paper include the following:  (G)overnment bond funds and European equities scored highest on ESG Quality, while small‐cap US, emerging market equity, and high yield bond funds scored lowest. Variation also existed within peer sets – for example, we found that Target Date funds with shorter time horizons tended to exhibit higher ESG quality, while longer‐horizon funds exhibited lower ESG quality.”

You may read more about and download an excerpt of the paper from research archive page of the MSCI internet site.