There has been considerable research on the relative performance of responsible investment versus traditional investment strategies. Most of this research suggests that taking into account material environmental, social and governance factors results in investment out-performance.

Deutsche Asset & Wealth Management

Deutsche Asset & Wealth Management, together with the School of Business, Economics and Social Science at the University of Hamburg, undertook a definitive meta-study in 2015 which reviewed more than 2,000 research reports on ESG and corporate financial performance. It concluded that “the business case for ESG investing is empirically very well founded. Roughly 90% of studies find a nonnegative ESG–CFP relation. More importantly, the large majority of studies reports positive findings. We highlight that the positive ESG impact on CFP appears stable over time.”

Harvard Business School

In 2016, the Harvard Business School published 'Corporate Sustainability: First Evidence on Materiality' which concluded that 'firms with good ratings on material sustainability issues significantly outperform firms with poor ratings on these issues. In contrast, firms with good ratings on immaterial sustainability issues do not significantly outperform firms with poor ratings on the same issues.'

Oxford University: Smith School of Enterprise and the Environment

A 2015 meta-study by Oxford University's Smith School of Enterprise and the Environment together with Arabesque Partners, 'From the stockholder to the stakeholder: how sustainability can drive financial performance', noted that:

  • 90% of the studies on the cost of capital show that sound sustainability standards lower the cost of capital of companies.
  • 88% of the research shows that solid ESG practices result in better operational performance of firms and
  • 80% of the studies show that stock price performance of companies is positively influenced by good sustainability practices.

Other research

For further analysis of the relationship between the application of sustainability and corporate governance factors and investment performance-related research, see SRI-CONNECT: Buzz search: General – Investment Performance