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ESG and Advisory Responsibilities


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I'm retired and so this does not involve my present client experience, but I am reading quite a bit these days on ESG investing and this apparent growing interest by employees and other clients. For this I've got a couple of questions others may be able to address.

1. Holding or not holding a stock or fund holding that stock has nothing to do with the ability of the company to be profitable, yet I never see this addressed in the articles I'm reading on ESG qualifying stocks. I can certainly understand that there may be 'feel-good' component to this on the part of the client and perhaps some virtue signaling. But it would seem logical to me that in the client discussion would be a paragraph on how ownership/non-ownership does not affect the company's performance and instead, the buying of the company's products/services does this.

2. What constitutes an ESG qualifying company? Other than broad qualitative factors, what would an IA use as quantifiable selection criteria if individual stocks were used rather than ESG funds?

Thanks for any information on this

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