Where ESG Ratings Fail: The Case for New Metrics | Institutional Investor

This opinion piece presents a case for hybrid metrics that directly combine social/environmental and financial performance – for instance metrics that link profitability to nutritional value for food and beverage companies.

“Multiplying a company’s EBITDA margin by the index score from the Global Access to Nutrition Index yields a distinctly different result than profitability or nutrition alone. As consumer tastes and government regulation increase pressure for healthy food and beverage offerings, it will be increasingly important to understand not just which companies are profitable and which offer good nutrition, but which companies offer good nutrition most profitably.”