Environmental, Social, and Governance (ESG) Analytics Lab

ESG Analytics Lab

Within the last five years, the share of total global assets under management actively weighting Environmental, Social and Governance (ESG) factors has doubled (to $30.7 Trillion or 39% of total AUM) as has the share of executives, board members, and investment managers who consider ESG issues to be material. At the same time, however, the confidence of executives, board members, and investment managers in the data available to evaluate the materiality of ESG factors has halved. ESG scores across proprietary data providers have been demonstrated to be unreliable and often lean on outdated information around relevant ESG factors—others omit pertinent factors in their scoring altogether.

The ESG Analytics Lab seeks to solve these problems by leveraging Wharton’s demonstrated expertise in analytics. We focus on developing high-quality, replicable academic research and pedagogy resulting in insights that can help current and future investors, asset managers and other ESG integrators make informed decisions.

ESG in Action

The ESG Analytics Lab supports high-quality, replicable academic research on ESG integration using alternative data sources as well as producing novel pedagogy showcasing best practices among asset managers. We also partner with students and seek to influence practice and policy.

Conducting academically rigorous and practically relevant research on ESG integration.

In three published papers and two working papers, Witold Henisz, Sinziana Dorobantu and Lite Nartey demonstrate the materiality of stakeholder engagement for 19 publicly traded gold mining companies, show that positive stakeholder sentiment is particularly valuable during a crisis, and analyze different strategies for earning and maintaining stakeholder support.

⇒ Read Gold Mining Research Papers

⇒ More ESG Research

  • Professor Claudine Gartenberg analyzes the financial impact of corporate purpose as well as its determinants. She also studies the determinants of pay inequality among employees within and between firms as well as the role of social comparisons in limiting such inequality.
  • Katarzyna Odziemkowska and Witold Henisz demonstrate that managerial choices regarding their firms’ performance on ESG are a function of national societal pressure on these issues as measured by media content analysis
    • Odziemkowska, Katarzyna and Witold J. Henisz, (2020) “Web of Influence:
      National Stakeholder Networks and Corporate Social Performance” Organization Science Forthcoming.
  • Sarah Light and Steven Kimbrough are using computational text analysis of corporate disclosure documents to help justify a more rigorous standard for mandatory audited ESG disclosure.
  • Aline Gatignon studies ESG implementation among Indian firms after a government mandate and in cross-sector collaborations in emerging markets.
  • James McGlinch and Witold Henisz are integrating value-based strategy and stakeholder theory in a paper that maps ESG impacts onto intermediate accounting outcomes highlighting the differential materiality across industries and time based on structural characteristics as well as shifting stakeholder salience.
  • Chris Bruno and Witold Henisz in partnership with ESG Analytics Lab Corporate Research Sponsor the Calvert Institute are analyzing the materiality of ESG factors for municipal finance.
  • Kevin Chuah, James McGlinch and Witold Henisz are analyzing the determinants of inflows into ESG oriented mutual funds and ETFs and helping to expose the rampant greenwash (i.e., false claims regarding ESG integration) characterizing many of the offerings in this rapidly growing investment domain.
  • Witold Henisz is working to augment existing ESG metrics focused largely on voluntary corporate reporting and/or media-reported stakeholder sentiment to more tangible and science-based outcomes of relevance to stakeholders. This work highlights the financial materiality of a firms’ negative externalities imposed on stakeholders for shareholders in the future through distinct stakeholder pathways whose strength varies by industry and stakeholder salience.
  • Tony He is analyzing the strategic response of consumer product companies to ESG scandals impacting competitors’ products.
  • James McGlinch is analyzing the role of ESG for firms in financial distress including analysis of the likelihood they enter into reorganizations, the type of reorganization (i.e., Chapter 7, Chapter 11 or private reorganization) as well as the outcome of that reorganization and the firms’ subsequent economic performance.
  • Maria Gelrud and Jessica Wachter analyze the impact of climate risk for asset pricing

Expanding the scope of ESG data available to scholars affiliated with the Lab beyond the suite available through Wharton Research Data Services (e.g., MSCI-KLD, Sustainalytics, RepRisk, Ravenpack).

For access to these datasets, please contact henisz@wharton.upenn.edu.

Developing pedagogy to bring the practical challenge of ESG integration into the classroom.

We are partnering with

  • Parnassus Investments,
  • Glenmede,
  • Alliance Bernstein,
  • Record Currency Management,
  • Atlas Impact Partners and
  • Calvert

to showcase best practices in ESG integration across different asset classes and investment strategies. We hope to launch an online course on ESG integration in 2021-22.

Partnering with students to support and develop their ESG integration skills through competitions, career expos, speakers, networking events and other initiatives.

Influencing practice and policy via industry-facing publications, speaking events and policymaking debates

Publications

In the News

Stay up to date on ESG Analytics at the Wharton School.

Claudine Gartenberg

Witold Henisz

Tyler Wry

Corporate Partnership Program

The ESG Lab connects corporate partners with our four pillars of work

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Nimble and Accurate ESG Valuation

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Comprehensive, Transparent and Objective Rankings

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Thought Partnership for Innovative Research

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Building a Talent Pipeline of Future ESG Leaders

Our Partners

The Team

Our team of faculty and doctoral students are advancing the frontier of ESG Analytics.

Faculty

Carolyn Deller
Assistant Professor of Accounting

Emilie Feldman
Associate Professor of Management

Claudine Gartenberg
Assistant Professor of Management

Aline Gatignon
Assistant Professor of Management

Witold Henisz
Deloitte & Touche Professor of Management

Chris Ittner
EY Professor of Accounting

Benjamin Keys
Rowan Family Foundation Associate Professor; Associate Professor of Real Estate

Steve Kimbrough
Professor of Operations, Information and Decisions

Sarah Light
Associate Professor of Legal Studies & Business Ethics

Mary Hunter McDonnell
Associate Professor of Management

Philip Nichols
Joseph Kolodny Professor of Social Responsibility in Business; Professor of Legal Studies & Business Ethics

Eric W. Orts
Faculty Director, Initiative for Global Environmental Leadership; Guardsmark Professor of Legal Studies and Business Ethics

Deborah Small
Laura and John J. Pomerantz Professor of Marketing; Professor of Psychology

Jessica Wachter
Dr. Bruce I. Jacobs Professor in Quantitative Finance

Tyler Wry
Associate Professor of Management

Visiting Scholars

Kevin Chuah
Doctoral Candidate in Strategy & Entrepreneurship, London Business School

Rachelle Sampson
Professor of Logistics, Business and Public Policy, University of Maryland

Doctoral Students

Aymeric Bellon
Doctoral Candidate, Finance Department

Chris Bruno
Doctoral Student, Management Department

Samantha Darnell
Doctoral Student, Management Department

Maria Gelrud
Doctoral Student, Finance Department

Tony He
Doctoral Student, Applied Economics

James McGlinch
Doctoral Student, Management Department

Philip Mulder
Doctoral Student, Applied Economics