By Jon Hay
05 May 2021
A small band of committed investors in Tesco has achieved spectacular success with a shareholder motion on healthy food. This should embolden investors to hold issuers to account on a wider range of social matters and also contains a deeper lesson about how markets bring about change.
To listen to some in the capital markets, environmental, social and governance investing is all about numbers.
Investors, they argue, need to build up better data about companies’ and governments’ characteristics, feed this into their valuation models, and slowly but surely, money will migrate to better ESG performers, lowering their cost of capital.