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COVID-19 Crisis: ESG Outperforms - will it last?

  • ,  Chief Executive |
  • 20 Apr 2020
  • Updated 30 Apr 2020

A Flash in the Pan or Something more 'Sustainable'?

It is very early days, but there is some evidence that stocks with high ESG scores appear to have outperformed the wider market by a sizeable margin both during the recent downturn and over longer time periods too. Whether this outperformance persists during the economic recovery phase from COVID-19 is perhaps up for debate, but it appears likely that governments are more likely to direct future expenditure towards some of the areas that tend to feature prominently in ESG portfolios, such as healthcare provision and pharmaceuticals.

One noticeable effect during the COVID-19 global lockdown has been the decrease in environmental emissions; the death toll from air pollution is estimated by the WHO at some 7 million annually, which perhaps puts COVID-19 into some context. It remains to be seen whether climate risk remains at the top of the agenda as the world attempts to restart industrial output to recover from the highly negative economic effects of the COVID-19 pandemic.


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