CFA Institute Sustainable-Investing Question Answer
Which of the following is a challenge in ESG integration?
A.
ESG disclosures that lack comparability across companies
B.
Excessive company-level ESG reporting that overwhelms investors
C.
Standardized disclosures in audited financial statements that hinder differentiated analysis
The Answer Is:
A
This question includes an explanation.
Explanation:
One of the key challenges in ESG integration is the lack of comparability in ESG disclosures across companies. Without standardized reporting frameworks, it can be difficult for investors to assess and compare ESG performance across different firms, making it harder to integrate ESG into the investment process.ESG Reference: Chapter 7, Page 368 - ESG Analysis, Valuation & Integration in the ESG textbook.
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