Faculty Mentor(s)
Doug Nielsen
For Communication to Presenters & Mentors
gvdelreal@olivet.edu, dnielsen@olivet.edu
Project Type
Honors Program project
Scholarship Domain(s)
Scholarship of Discovery, Scholarship of Community Application
Presentation Type
Presentation
Abstract
The growing importance of environmental, social and governance (ESG) policies in global industries has attracted special attention from investors seeking to evaluate companies beyond traditional financial metrics. This study aims to determine if there is a statistically significant difference in the returns of ESG funds between the United States and the European Union. ESG factors encompass environmental, social and governance standards, with each region exhibiting unique regulatory approaches and implementation levels. The project recognizes the current lack of universal standards in ESG assessment and the prevalence of issues of misinformation, greenwashing and transparency in reported data. By comparing randomly selected stocks of ESG index funds in the US and EU, the study aims to contribute to the understanding of the impact of regional regulatory variations on fund performance. Given the changing nature of ESG and its growing investment, this research seeks to provide insights into responsible and informed investment decision-making.
The global importance of this study lies in the conflicting stages of adoption and implementation of ESG initiatives in the US and EU. While the EU has moved forward with comprehensive rules, the United States is in the early stages of establishing unified regulations. The research emphasizes the need for standardized measurements and the potential risks associated with substantial investments in ESG funds. This project underscores the importance of examining ESG data from companies of all sizes and industries to understand the environments in which ESG is most effective. As ESG is developing rapidly, it aims to contribute to the current discourse on its credibility, implications, and suitability for different companies and environments. Ultimately, the study addresses clients’ responsibility in shaping the financial and environmental future, emphasizing the need for comprehensive analysis to discern the true impact of ESG funds on social and financial aspects.
Permission Type
This work is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 4.0 License.
Included in
Business Analytics Commons, Education Economics Commons, Finance and Financial Management Commons, International Business Commons, Portfolio and Security Analysis Commons
An Evaluation of Environmental, Social, and Governance Standards on Fund Performance: Comparison of ESG funds in the United States and the European Union
Fishbowl
The growing importance of environmental, social and governance (ESG) policies in global industries has attracted special attention from investors seeking to evaluate companies beyond traditional financial metrics. This study aims to determine if there is a statistically significant difference in the returns of ESG funds between the United States and the European Union. ESG factors encompass environmental, social and governance standards, with each region exhibiting unique regulatory approaches and implementation levels. The project recognizes the current lack of universal standards in ESG assessment and the prevalence of issues of misinformation, greenwashing and transparency in reported data. By comparing randomly selected stocks of ESG index funds in the US and EU, the study aims to contribute to the understanding of the impact of regional regulatory variations on fund performance. Given the changing nature of ESG and its growing investment, this research seeks to provide insights into responsible and informed investment decision-making.
The global importance of this study lies in the conflicting stages of adoption and implementation of ESG initiatives in the US and EU. While the EU has moved forward with comprehensive rules, the United States is in the early stages of establishing unified regulations. The research emphasizes the need for standardized measurements and the potential risks associated with substantial investments in ESG funds. This project underscores the importance of examining ESG data from companies of all sizes and industries to understand the environments in which ESG is most effective. As ESG is developing rapidly, it aims to contribute to the current discourse on its credibility, implications, and suitability for different companies and environments. Ultimately, the study addresses clients’ responsibility in shaping the financial and environmental future, emphasizing the need for comprehensive analysis to discern the true impact of ESG funds on social and financial aspects.