ESG Backlash Has Fund Clients Demanding Proof It Works

Investment clients are demanding more evidence that ESG asset managers can deliver on their promises, amid a steady stream of criticism that the industry is on the wrong track.

“There’s a lot of pressure on investment managers to demonstrate the value that they’re getting out of their stewardship work,” said Peter Reali, managing director of responsible investment and engagement at Nuveen LLC, which oversees about $1.3 trillion. And when it comes to wider industry efforts to cut portfolio emissions, ESG investment professionals “definitely hear the complaints and concerns,” he said.