Fraser Institute News Release: New essays explore myths and realities of ESG—Environmental, Social and Governance investing
Retrieved on:
Tuesday, August 30, 2022
The thrust of ESG investingto force companies to pursue goals other than just maximizing returns to shareholdersshows a fundamental misunderstanding of how market economies work.
Key Points:
- The thrust of ESG investingto force companies to pursue goals other than just maximizing returns to shareholdersshows a fundamental misunderstanding of how market economies work.
- Specifically, it misunderstands how firms pursuing profits already have to consider their communities, employees, suppliers, customers, and anyone connected with the business, explained Steven Globerman, resident scholar at the Fraser Institute and contributing editor of ESG: Myths and Realities.
- The first essay, The New Capitalism , identifies the various arguments made in favour of ESG investing, including mandatory ESG disclosures by public companies.
- For Friedman, when firms focus on achieving higher profits, other stakeholders, like consumers, employees and suppliers also benefit.