Doing some homework on alternative energy and sustainable investing, I came across a paper in the Financial Analysts' Journal using data from Innovest showing superior returns for a portfolio of companies rated highly on environmental metrics.
The difference between this study and earlier research is that green performance is measured, not just by reducing pollution, but by eco-efficiency, "defined as the ratio of the value a company adds (e.g., by producing products) to the waste the company generates by creating that value." This makes some sense -- attention to material efficiency, like supply chain efficiency, would improve a company's performance.
Posted by alevin at August 28, 2005 01:58 PM | TrackBack