Spurious correlation explains ESG alpha, say experts

The evidence is clear: ESG funds are outperforming their conventional counterparts. But some experts are questioning the traditional explanations for why that is. Investing responsibly does not have to come at the expense of reduced returns. More and more data has shown this to be the case. As a result, the appetite for environmental, social and governance investing has shot up in recent months. Morningstar found 75% of ESG-screened indices it studied outperformed their broad ma…