Scientific Beta

IPE: "Using ESG metrics does not build better portfolios than if investors just used traditional financial data, according to new research carried out by Scientific Beta."

IPE 10/07/2025

"(...) Using ESG metrics does not build better portfolios than if investors just used traditional financial data, according to new research carried out by Scientific Beta.

The index solutions provider found that there are financial performance benefits from integrating ESG information, but that this added value disappears when an out-of-sample analysis is conducted. (...)

(...) Felix Goltz, research director at Scientific Beta, told IPE the research also suggested that investors need to be more frank about the potential trade-offs involved in ESG integration, namely that pursuing optimal financial objectives could come at the expense of non-financial goals. (...)"