NN Investment Partners and the Yale Initiative on Sustainable Finance have teamed up to define how environmental, social and governance factors should be considered to improve the risk/return profile of investors' portfolios.
"So much new data has become available," Jeroen Bos, head of specialized equity and responsible investing at NN Investment Partners, The Hague, Netherlands, said in a telephone interview. There are new insights to be gained from ESG data, with the research showing that the increasing use of ESG integration can improve the risk/return of investment portfolios and help develop tools to achieve both financial and sustainable goals, Mr. Bos added.
This is not NN Investment Partners' first collaboration with an academic institution. In 2014, NN IP collaborated with Maastricht University on another ESG research project focused on the behavior of companies, Mr. Bos said. "If you have studied the behavior, you would have, for example, avoided being invested in BP before the (oil) spill."
Diane Strauss, research director at the Yale Initiative on Sustainable Finance, said in a news release: "We are primarily concerned with ESG data and its relevance to the capital markets."
"Testing how ESG information influences financial returns is a critical question for the industry," Ms. Strauss added.