Tuesday, July 18, 2023

News You Can Use: "'ESG' in US finance job titles comes with 20% pay premium"

And the beauty of it is, ESG can be anything you want it to be!

Want to put the head of Saudi Aramco on BlackRock's board? That's ESG baby.

Weapons, armaments and other war-making stuff? ESG! 
Although some ETF packagers draw the line at bombs that will be killing Ukrainian kids fifty years from now:

ESG Fund Bets Big on Weapons and Beats 98% of Peers
Meanwhile, the Vanguard ESG U.S. Stock ETF does have major military contractors in the portfolio but draws the line at cluster bombs and nuclear weapons....  

And the headliner from Reuters, May 19:

  • In demand as finance tracks environmental, social issues
  • Salary boost comes despite political backlash against ESG
  • April average pay: $110,348 vs non-ESG staff's $90,283

U.S.-based bankers and money managers whose job titles include "ESG" or "sustainability" earn on average around 20% higher base salaries than colleagues of the same seniority without those labels, according to analysis of salary data shared with Reuters.

More than $30 trillion in capital has been committed to environmental, social and corporate governance-related investments as the world looks to curb greenhouse gas emissions and companies face pressure on issues such as workplace diversity and social justice.

This has sparked a scramble to find bankers and asset managers for these roles, leading to higher base salaries than for equivalent professionals in non-ESG related functions, the analysis conducted for Reuters by New York-based data startup Revelio Labs shows.

"Salaries of ESG and non-ESG personnel started to diverge in 2020, in line with the spike in hiring in ESG roles due to the increasing focus on ESG and sustainable investing in the finance sector," said Loujaina Abdelwahed, an economist at the company....


So ignore that fellow at NYU's Stern School of Busines and partaay on the differential.

Professor Damodaren Writes About War and ESG
From Aswath Damodaran's Musing's on Markets Substack, March 28:

My views on ESG are not a secret. I believe that ESG is, at its core, a feel-good scam that is enriching consultants, measurement services and fund managers, while doing close to nothing for the businesses and investors it claims to help, and even less for society....

As noted in the outro from that post: 

I sometimes wish he wouldn't be so shy about expressing his opinions.
(J.K. Professor)