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S6 Ep8: Applying economics (not gut feel) to ESG

VoxTalks Economics

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How to Improve Firms ESG Metrics

I've spent a fraction of the time invested in this that a lot of other very smart people have done. We want to improve the measurements of those ESG metrics on the assumption that these capture the firms ESG policies impact on society. But it's not why because you can improve your metrics by dumping the problem on somebody else. For example, there was a nice academic paper which find that after environmental incidents, companies try to improve their environmental ratings. So yeah, my cleanliness has gone up but I haven't reduced the overall problem of their being trash.

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