The following is an excerpt from the FUND TRANSPARENCY: EXPLORING THE ESG QUALITY OF FUND HOLDINGS paper published by MSCI ESG Research in March 2016. You can obtain a copy of the full excerpt here: EXPLORING THE ESG QUALITY OF FUND HOLDINGS
In the next two decades, an estimated USD 30 trillion will be transferred between baby boomers and millennials in the US, and women are estimated to control more than two thirds of investment decisions in the retail space.
1 These same investors are likely to be younger and more likely to believe investments are a method to express social, political, or environmental values than their baby boomer counterparts.
2 To solve for the next generation of investors’ demands for greater transparency around the ESG characteristics of their investments, 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.