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Harvard Business Review

ESG Investing Isn’t Designed to Save the Planet

Harvard Business Review recently published an article coauthored by Andrew King, Questrom Professor of Management and Professor, Strategy & Innovation, addressing the historic surge in popularity of ESG investments and their impact on major societal problems.

Andrew King

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ESG Investing
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August 1, 2022

Harvard Business Review recently published an article coauthored by Andrew King, Questrom Professor of Management and Professor, Strategy & Innovation, addressing the historic surge in popularity of ESG investments and their impact on major societal problems.

Many individuals, institutional investors, and even portfolio managers are confused by the contradictory claims of ESG investments depicted in marketing materials. The authors argue that acknowledging and clarifying all of ESG investing’s shortcomings will help pivot to more productive and urgent endeavors.

“Though ESG investing is oversold, it is not the ‘devil incarnate.’ The addition of ESG fundamentals to traditional investing might someday allow investors to better predict returns and risks, but it will not save the planet.”

Andrew King
Questrom Professor of Management, Strategy & Innovation

Using evidence-backed observations, Andrew and his coauthor argue that ESG investing won’t address our generation’s urgent environmental and social challenges, and offer alternative recommendations, stating that, “none of these recommendations are straightforward. None will occur absent concerted civic engagement, global coordination, and a redistribution of power. At the same time, none rely on convenient confusion to oversell market based voluntary solutions.”

Professor Andrew A. King is a leading authority on environmental performance and innovation. His research established whether and when firms can find ways to profitably reduce their impact on the environment. His empirical tests of the efficacy of industry self-regulation helped change both private and public policy. His research now explores open source innovation and knowledge sharing. Andy was an early advocate of a scholarship on what is now called “sustainability”, and his findings and methods have influenced scholars in many disciplines. With students and colleagues, he helped found some of the most important research institutions in the field, culminating in the Alliance for Research on Corporate Sustainability. Andy has been a Marvin Bower Fellow at the Harvard Business School, an Aspen Institute Faculty Pioneer, and an Academy of Management Journal Best Paper Award winner His thesis won the Massachusetts Institute of Technology’s Zannetos Prize. Andy holds a BA from Brown University, an MS from the University of California, Berkeley, and a PhD from the Massachusetts Institute of Technology.

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