They are generally interested in risk mitigation and related costs.

Therefore, tactics derived from this strategy are abundant in environmental management arena (pollution prevention, cleaner production, etc ...).

Off course there is allot of "green-wash" designed to just create a make-believe.

It seems that ESG considerations are sometimes tackled the label of enterprise risk management (ERM) which may defined as a systematic integrated approach to inform business decision-making in relation to what needs to be done in order to reduce the uncertainty surrounding expected outcomes.

An upcoming conference on the topic to be held in Cambridge, MA: http://enviroecon.org/

The four main strategies are

1) negative screening

2) positive screening

3) impact investment

4) social shareholder engagement

Renard:

Asset selection strategies for portfolios and exert significant influence on the ISR indices financial performance, attractiveness to the public and in the nature of indices and funds ISR. Despite the importance, the great global institutions define and group strategies in different ways. In its report, Report on Socially Responsible Investing Trends in the United States, o Social Investment Forum, the United States, defines the three socially responsible investment strategies as below:

• Screening: including positive and negative filters, it is the practice of evaluation of portfolios and investment funds on the basis of social, environmental and corporate governance (ESG – Environmental, Social and Governance);

• Shareholder Advocacy: this is the involvement of investors taking active part in the debate and in the resolution of ESG issues. This involvement is, in practice, in the form of drafting resolutions that pass by a vote by the shareholders and, if approved, pressure on the management of the companies, earning media attention and educate the executives in order to best management practices;

• Community Investing: directs capital of investors to communities and groups of people who are marginalized by the traditional financial system, providing access to credit and financial products.

The European Sustainable Investment Forum ( http://www.eurosip.es/ ), through the report classifies the ISR strategies as follows:

• The Positive Screening: selection of companies that perform best in a set of ESG criteria;

• Best-in-class: selection of leading companies in each sector or industry group, considering a set of ESG criteria;

• Themed funds: focusing on specific sectors and causes of social and corporate responsibility, should take into account ESG criteria.

• The Negative Screening based on values: exclusion where more than two ESG criteria are taken into consideration for the assessment;

• The Negative Screening standards based: exclusions of enterprises based on the level of adherence to international standards and norms, as, for example, Organization for Economic Co-operation and Development (OECD) and United Nations Children's Fund (UNICEF);

• The Simple Screening: exclusions of sectors or companies based on up to two ESG criteria;

• Engagement: this is the long-term process with companies in order to influence the behavior related to ESG practices.

• Integration: explicit inclusion of environmental, social and corporate risks to traditional financial analysis.

Be under the classification of Europe or of the United States, these panels bring out the diversity and selection strategies of socially responsible investments.

Just came across this exploratory paper. Thought I'd share this with the group.

Young A 2013 'The multiple forms of environmental, social and corporate governance (ESG) integration in investment, HEC Business School Seminar Presentation, Paris, France, 19 February 2013

Renard:

Thanks for the vote! But, I'm sorry to inform you that this is not my area of action. Just recently I've been reading on the subject.

I hope I helped

Another report that summarizes approaches to ESG investing

http://www.top1000funds.com/wp-content/uploads/2011/08/Integrating_ESG_into_the_Investment_Process_Aug_20111.pdf

You might want to check www.gresb.org, which was initiated by 3 institutional investors. Although it is more focused on real estate, it clearly shows the desire from investors to improve awareness and improve performance on sustainability.

Thank you for the comments. Found them very helpful.

I propose new indexes to make better decisions. You can read about it in my articles. I also propose to use these indicators in combination with models of input-output, but the article about it published so far only in Russian. In principle, I can make the papers in English.