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A Critical Look at the ESG Market
Article

A Critical Look at the ESG Market

CEPS, 2022


Editorial Rating

8

Qualities

  • Background
  • Concrete Examples
  • Hot Topic

Recommendation

Environmental, social and governance (ESG) investing has moved from a remote corner of the investment horizon into the mainstream. Yet for all its progress, the sector faces critical challenges, notes consultant Agnes Sipiczki in this informative essay on the European ESG experience. She analyzes the problems of information asymmetry, high fees, and a lack of transparency and comparative data, and she calls for professional investors and regulators to take the lead in developing and maintaining a global set of standards that will allow the sector to grow.

Take-Aways

  • Environmental, social and governance (ESG) investments have become a significant asset class in Europe. 
  • The ESG sector is experiencing growing pains.
  • Policy initiatives to increase disclosure rules and develop standards will aid the sector’s growth.

About the Author

Agnes Sipiczki is a former CEPS research assistant and presently a consultant at FTI Consulting.