ECCE publishes results of a new study

Do environmental, social and governance issues matter?

ECCE publishes results of a new study

The European Centre for Corporate Engagement (ECCE) has completed the first pilot study of the use of extra-financial information by European research analysts and investment managers. With more than 850 respondents from 88 sell-side and 240 buy-side institutions, it is one of the largest ever attempts at analysing how information relating to environmental, social and governance (ESG) issues is used in valuation and investment decisions.

Key findings

  • Evidence suggests a growing interest in SRI. However, investors continue to manage only a small percentage of their assets on an SRI basis, while ESG issues remain a niche market and are integrated into mainstream investments only to a limited extent.
  • Corporate communication practices relating to ESG issues seem to have improved, but many analysts and investors do not perceive that the companies provide enough information to allow effective assessment of these factors’ impacts.
  • Major differences exist between sectors in the relative importance of various ESG factors. Environmental issues are important mainly for companies in environmentally-sensitive sectors such as automotive, mining and utilities. Human rights issues play a major role for consumer goods makers, and community involvement matters for companies in sectors such as mining, steel and metals.
  • Corporate governance criteria are the most important of all ESG factors across all sectors, and are seen by many research analysts and investors as forming a separate category.
  • Extra-financial information is believed to have a significantly higher impact on brand and reputation than on market value or financial performance. Differences are also noted between short-term and long-term impacts.
  • Companies that score high on ESG criteria seem to be rewarded with premium valuation, while companies that score low are likely to be penalised with valuation discount. However, a negative bias means that low scores have a more pronounced effect on valuation than do high scores.
  • Many sell-side analysts indicate that their institution has not developed an ESG policy, which generally hampers the use of extra-financial information in their analysis. Additionally, analysts who cover more companies focus less on ESG factors in their analysis.
  • Sell-side analysts use extra-financial information to a lesser extent than investors, and point out that the lack of a universally accepted methodology for quantifying ESG data makes it difficult to incorporate extra-financial information into their analyses.
  • Investors, in particular, large, long-only institutions, show more awareness of ESG policies and products than sell-side analysts do. Fund managers seem to use extra-financial information to a lesser extent than buy-side analysts, while hedge fund managers focus less on ESG issues than do other investor types.
  • Full report can be downloaded from ECCE’s website:

    About ECCE

    ECCE – The European Centre for Corporate Engagement – is an internationally oriented research consortium devoted to delivering research in the fields of corporate engagement and sustainable finance. Founded by researchers from universities in Maastricht and Rotterdam in the Netherlands, and supported by a grant from the Swedish Foundation for Strategic Environmental Research (Mistra), ECCE’s mission is to develop, communicate and promote a thought-provoking and innovative body of knowledge concerning sustainable business and finance. The objective is to expand the knowledge of how businesses and financial markets can promote sustainable development by considering environmental, social and corporate governance (ESG) issues. To ensure that its research deliverables have both academic stature and practical relevance, ECCE cultivates a close dialogue and interdisciplinary cooperation with market players in its daily operations. The resulting international and continuously expanding network includes companies like ABP Investments, who provides input for research projects and is co-involved in translating results into concrete policies; and Fortis, who supports the ECCE initiative with a Sustainable Finance chair at Erasmus University. International ties have also been established with Innovest Strategic Value Advisors, Governance Metrics International (GMI), Institutional Shareholder Services (ISS), and the Swedish partners MISTRA and Umeå School of Business.

    For more details on ECCE, please visit or contact Els van Aernsbergen at +31 43 388 3838 or

    Werden Sie Mitglied im UVG e.V. und gestalten Sie den Nachhaltigkeitsdialog mit. > Die Infos
    DSGVO Cookie Consent mit Real Cookie Banner