Sovereign ESG Insights - November 2020

30 November 2020
1 min read
Sovereign ESG Insights - November 2020

What You Need to Know

The US still lags developed countries in ESG progress, based on our research. But with a new Biden administration imminent, scores could begin to improve. And better government handling of the COVID-19 crisis may raise ESG marks as well, which is what we’re seeing in Europe.

Key Developments

  • The US After the Election—The US continues to lag most other developed economies from an ESG perspective: it’s close to the bottom of the fourth quartile according to our proprietary ESG indicator (complete list of scores by country on page 8 of attached). Could a change of political leadership mark a different path?
  • ESG in Action—Nowhere is the power of ESG as an investment tool better illustrated than in Turkey, where a forward-looking focus on governance has been the key to anticipating this year’s asset-price gyrations.
  • Brazil: Time for A Rethink?—Deforestation in the Amazon has tainted Brazil’s reputation on the world stage. But the Brazilian central bank is ahead of the curve in its environmental policy agenda.
  • ESG and COVID-19—Can ESG help explain the different degrees of success governments around the world have had in handling COVID-19? At first glance, the answer seems to be no, but a closer analysis of COVID-19 in Europe reveals a close link between higher ESG scores and better public-health outcomes.
  • ESG Ratings Dynamics: CEEMEA Focus—ESG scores in the Middle East and Eastern Europe have outperformed over the past year, though recent social and governance instability poses a question mark over further near-term improvement.

At a Glance – US Lags in ESG Scores; Global Economic Uncertainty Still High

At a Glance-US Lags in ESG Scores; Global Economic Uncertainty Still High

*Simple average.
Source: Haver Analytics and AllianceBernstein (AB)

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