In January 2019, the CFA Institute endorsed ESG integration in investment analysis. As noted in the position statement's release, "Key points in the new Statement include the duty of CFA charterholders to factor in all material information, including material ESG factors into investment analysis, unless contrary to client wishes. The Statement notes that such factoring is consistent with an investment manager’s fiduciary duty."
The CFA Institute's full position on ESG integration is available here.
Highlights from the position statement include:
- "CFA Institute Standards of Professional Conduct require CFA® charterholders to conduct appropriate research and investigation of all material information relevant to their investment analyses and portfolio management decisions, recommendations, or actions."
- "CFA Institute believes this requirement includes the consideration of material ESG information/considerations (ESG factoring) as an important component of a complete and thorough financial analysis for any actively managed fundamental investment portfolio."
- "More broadly, CFA Institute encourages all investment professionals to consider ESG factors, where relevant, as an important part of the analytical and investment decision-making process, regardless of investment style, asset class, or investment approach."
- "ESG factoring is consistent with a manager’s fiduciary duty to consider all relevant information and material
risks in investment analysis and decision making."
The Institute also stressed the need for further transparency and standardization of ESG reporting by companies and managers, and committed to continuing to deepen the resources on ESG in its educational content.