Scientific Beta

Private Wealth Canada: "Traditional climate investing strategies do not live up to the promises of their promoters, says a study produced as part of the EDHEC-Scientific Beta Advanced ESG (environmental, social, and climate) climate investing research chair study. (...) It must be recognized that portfolio decarbonization objectives are often achieved by implementing sector greenwashing."

Private Wealth Canada 27/09/2021

"(...) Traditional climate investing strategies do not live up to the promises of their promoters, says a study produced as part of the EDHEC-Scientific Beta Advanced ESG (environmental, social, and climate) climate investing research chair study. (...) It must be recognized that portfolio decarbonization objectives are often achieved by implementing sector greenwashing. Climate strategies and benchmarks may exhibit strong sector deviations by organizing their decarbonization through a reduction in the capital allocation to sectors with strong climate intensity. An under-representation of sectors that are key not only for growth, but also for energy transition, would be particularly problematic. Since considerable investment is necessary to ensure electrification of the economy and decarbonization of electricity, underfunding of this sector in climate-aligned benchmarks, which can correspond to a reduction in capital allocation of up to 91 per cent, would constitute the most dangerous form of portfolio greenwashing. (...)"