Green Tilts

Lubos Pastor, Robert Stambaugh and Lucian A. Taylor

No 31320, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We estimate financial institutions' portfolio tilts related to stocks' environmental, social, and governance (ESG) characteristics. From 2012 to 2023, ESGrelated tilts consistently total about 6% of the investment industry's assets and rise from 17% to 27% of institutions' total portfolio tilts. Significant ESG tilts arise from the choice of stocks held and, especially, the weights on stocks held. The largest institutions tilt increasingly toward green stocks, while other institutions and households tilt increasingly brown. Divestment from brown stocks is typically partial rather than full, even for individual mutual funds. UNPRI signatories and European institutions tilt greener; banks tilt browner.

JEL-codes: G11 G23 (search for similar items in EconPapers)
Date: 2023-06
New Economics Papers: this item is included in nep-ban, nep-ene, nep-env and nep-fmk
Note: AP CF
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Working Paper: Green Tilts (2023)
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