Good to see it isn't necessarily the case.
The old man is a caricature of Jens Stoltenberg (who seems to be running the Norwegian economic machine rather well nowadays, controversial or not)
Which is exactly why you wouldn't put it in a company with a ridiculous valuation.
This is about valuation not ESG
No one in the green movement ever spoke about "ESG" as if that was a thing. It is an investor thing. Invented by bank economists, to sell financial products. It's not like your local environmentally concious hippie type figure would suddenly start investing in Shell, just because they improved their ESG score.
Does it work as a predictor for company valuation? It seems so. But it would probably have worked better if you separated E and G, because they have nothing to do with one another. Will it work in the future? No one knows. Once you start gaming these things, all initial bets are off by a lot.
Just don't say "valuation, not ESG". It does not make sense. If you mean "short term valuation, not long term", then just say so.
There is a huge difference between funding oil extraction that is happening anyway, and funding a company to start extracting oil.
However, this is the intersection of consequentialism, deontology, and virtue theory.
The area for disincentivizing oil production is the political sphere, not the financial sphere. Refusing to participate in secondary market ownership does almost less than nothing to disincentivize the extraction. At least with ownership, you get a say in the firms harm mitigation.
I agree that buying on the secondary market doesn't directly give money to the company. However, it increases demand (and therefore price) of shares in petrol companies, which might help them raise more money per share for new projects.
The earnings coming from such shares also comes from actively encouraging CO2 producing activities. Some people don't want to earn money that way, because they think it is morally wrong.
I mean that's fair, but it's also why I brought up the three major schools of ethics. The consequentialist likely won't care if it's going to happen anyway. The virtue ethicist will.
In turn you also want democratically elected politicians above that saying “yes, but the people want their money made ethically, so you can’t do that”.
In a good system both sides fight for their interests, and the outcome is some middle road compromise that optimizes for everyone's benefit.
This leaves room for individuals to act in accordance with their morals above and beyond the law.
The job of the police is arresting people who break the law, but similarly to your money manager, you really don't want them to do this regardless of anything else, there is more things to consider than just "do everything you can to arrest people", and hopefully the same for your money manager. But also, I might be too European to understand the true value of "money grow regardless of society cost at large".
> "but our job is to earn money and we can't do that if you hippies keep standing in the way with your morals"
What these clowns conveniently forget is that their job is not just "to make money" but to make money over a span of decades and centuries in the case of the sovereign funds. A long term investment fund that optimizes for the next quarter at the expense of the long term is a bad fund.
And so the ESG and woke "hippie bullshit" is nothing more than the basic capitalism of maximizing your gains by 2100 by not destroying the one planet all your companies are on.
Long term funds do not have the luxury of being passive owners. If they take no role in management, that role will instead by taken by whatever short-term owner walks in next. They don't care about the value by 2100, they just want the company to tear the copper out of it's own walls so they can sell with a profit by next quarter, retail even sooner.
ESG is just another phony way for someone to manipulate stock prices, because it's decided by some committee with arbitrary and opaque ways. And that's why no one takes it seriously any more.
ESG is more than just the environment. In Tesla's case, Elon Musk's governance is a serious risk to the corporation.
> ESG is just another phony way for someone to manipulate stock prices, because it's decided by some committee with arbitrary and opaque ways.
Right now as we speak, a bunch of "arbitrary opaque committees" are deciding to rush SpaceX, Anthropic, and OpenAI into the major stock indexes.
Even completely passive investment leaves one at the whims of said committees.
If nothing else, at least these should be choice of users to let them choose based on their values and requirements.
Pensioners should get the same amount regardless of investments, as long as there is enough funding, which it seems there is for the moment.
Of course, if someone wants to risk their own money, they can invest in whatever they want. They can even sell their pension for a cash lump sum and invest that.