PitchBook Analyst Note: Are “ESG Investors” Underperforming?

Are "ESG investors" underperforming?
 
As the crowd of ESG critics has grown, funds raised by asset managers that have made public commitments to ESG have garnered trillions of dollars. Some say that considering ESG factors is integral to making and managing prudent investments. Others think ESG is a distraction and that its adherents sacrifice returns.
 
Our latest research analyzes the returns of Principles for Responsible Investment signatory funds, as well as funds whose managers didn’t commit to uphold those guiding ESG principles, to determine how their performance compares across PE, private debt, real assets, and real estate from 2010 to 2018. The findings might surprise ESG-savvy investors and their critics.