Lack of Trust in ESG Data Hinders Sustainable Investing, Says Deloitte & Fletcher School

A global study by Deloitte and The Fletcher School at Tufts University reveals that while sustainable investing has seen significant growth in the United States over the past five years, trust in the environmental, social, and governance (ESG) data used for investment decisions is lacking. The survey found that 83% of US investment management professionals now have a sustainable ESG investing policy in place, compared to just 27% five years ago. Additionally, 81% of respondents reported seeking out sustainability information as part of their due diligence efforts. However, concerns were expressed regarding the availability of clear, reliable, and trustworthy ESG data, with issues highlighted such as lack of measurable outcomes from corporate disclosures, uncertainty on how to integrate ESG information, and inconsistency or incomparability of ESG ratings data. The study emphasizes the need for improvement in the collection, measurement, reporting, and validation of sustainability data to enhance investor trust. While the US is witnessing increased integration of sustainability and ESG into investment decision-making, addressing the concerns related to ESG data quality and consistency will be crucial in building confidence among stakeholders and supporting effective ESG investment strategies. Resources: https://esgnews.com/lack-of-trust-in-esg-data-hinders-sustainable-investing-says-deloitte-fletcher-school/