ESG measurement methodologies

Time: 13 October, 12:00 - 13:00 GMT (14:00 - 15:00 CEST)

Location: Microsoft Teams

Teams invitation will be sent to registered parties, prior to the meeting

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Presentation by Dr. Florian Berg at MIT on ESG measurement methodologies.

The presentation starts with a deep dive into the reasons why environmental, social, and governance (ESG) ratings disagree. Further analyzing the reasons for measurement divergence, we detect a rater effect where a rater’s overall view of a firm influences the measurement of specific categories. I will then discuss how measurement divergence and measurement error affects standard asset pricing tests that try to make a link between ESG ratings and stock return. Measurement error is not necessarily coming from ESG measurement methodologies and I show that a prominent database (Refinitiv) engages in retroactive data changes. The presentation will end with a discussion of the financial/ economic impact of ESG ratings. 

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Florian is currently a research scientist at the MIT Sloan School of Management where he cofounded the Aggregate Confusion Project. His research interest covers sustainable investing with a focus on ESG ratings, the disagreement between different rating agencies, and how it affects investors, firms, as well as academic research.

He received his PhD in economics from Paris-Dauphine University. During his PhD, he held a visiting research position at ETH Zurich. Florian worked as a quantitative researcher at Amundi Asset Management and as a quantitative strategist/ trader at Alphadyne Asset Management. He taught at Paris-Dauphine University, Sciences-Po Paris, and MIT Sloan.

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Kind regards,

The Board of Directors of IcelandSIF