Is the sustainability "bubble" ready to pop on Wall Street? Should PR share the blame for the growing price gap between social responsibility stocks and other equities?
Morningstar found that investors poured $21B into environmental, social and governance funds in 2019, just about quadrupling the 2018 amount.
Savita Subramanian, Bank of America's head of US equity strategy, said the "monstrous" inflow of money into ESG funds is driving the valuation gap, according to The Financial Times.
Some Wall Streeters believe ESG stocks are on fire because corporate CEOs heed PR messaging about meeting the needs of all stakeholders, including employees, customers, communities and society as a whole.
The FT noted that money flowing into energy renewable stocks comes at the expense of oil & gas companies.
“There appears to be a growing disconnect between operational performance and share price returns,” said Eugene Klerk, head of global ESG research at Credit Suisse. “There is a growing awareness or nervousness around this particular topic.”
Morgan Stanley reports the outperformance of ESG stocks began six to nine months ago and that it typically takes at least five years before overheated sectors cool down.
That means there's still plenty of time for corporate CEOs to buy into PR's ESG pitch.
Twitter feels heat on global warming. While Facebook is taking hits for its policies on political advertising, Twitter deserves scrutiny for running tweets denying global warming that are produced by bots.
A quarter of all climate crisis tweets stem from bots, according to a not-yet-published study from Brown University. The Guardian of the UK obtained a draft of the report.
The Brown researchers found the bots had a "substantial impact" in amplifying global denial messaging and building support for president Trump's decision to withdraw from the Paris climate agreement.
Stephan Lewandowsky, co-author of the study that analyzed 6.5M tweets, isn't surprised at the global denial messages. “More often than not, they turn out to have all the fingerprints of bots,” he told The Guardian. “The more denial trolls are out there, the more likely people will think that there is a diversity of opinion and hence will weaken their support for climate science."
What do you say, Twitter?
It's time to put the trusty Edelman Trust Barometer to work.
President Trump said Feb. 21 that reports from US intelligence about Russia's planned meddling in the 2020 election are just more attacks on America's victim-in-chief.
“Another misinformation campaign is being launched by Democrats in Congress saying that Russia prefers me to any of the Do-Nothing Democrat candidates who still have been unable to, after two weeks, count their votes in Iowa. Hoax number 7!”
The Kremlin seconded their guy, dismissing the story as "fake news."
Spokesperson Dmitry Peskov said:
“These are more paranoid announcements which, to our regret, will multiply as we get closer to the [US] election,” They have nothing to do with the truth.”
US intelligence officials would not comment about the briefing made to the House Intelligence Committee, though the panel's chairman, Adam Schiff, did.
He tweeted Feb. 20:
We count on the intelligence community to inform Congress of any threat of foreign interference in our elections. If reports are true and the President is interfering with that, he is again jeopardizing our efforts to stop foreign meddling. Exactly as we warned he would do.
Who do you believe, Trump, Peskov or Schiff? Is the country ready for another round of impeachment hearings?