The temptation for asset managers may be to hop on the bandwagon and start talking about the various “green” products they offer, but the result of this approach is creating fatigue around the topic. In short, journalists are tired of ESG – more specifically, so-called ‘8 out of 10 cats’ research and commentary based on little insight just that doesn’t fit the bill anymore.

Whilst in recent conversation with a trade journalist, we were told that articles on their website about ESG typically have some of the poorest click-rates. That’s not to imply that readers are disengaged from ESG; it is more likely a reflection of the quality of content in that space. Indeed, much of the thought leadership research journalists receive is based on sentiment surveys, and whilst there is value in understanding where investors might be interested in investing next, the old adage of ‘action speaks louder than words’ comes to mind.

Take, for example, the recent research from FTSE Russell, which surveyed over 200 asset owners with an estimated total AUM of $2trillion which showed hard figures on their allocations in sustainable investing. Hard, robust data is essential, but not the be all and end all – and can effectively be supplemented by sentiment-based research. The FTSE Russell example goes on to explain why the US dawdles behind Europe in terms of ESG adoption, with the survey revealing that the top motive for applying ESG factors is not for social good, as one might expect, but to “avoid long term risk.”

So, talking about ESG should be more than just what people think, but another thread in this is that ESG is far more than just being green. Another trade journalist from an international title noted that much of ESG is around “greenwashing” of products and there has been some scepticism in the media around products in the market, and whether they are simply ‘greenwashed’ for marketing purposes.

ESG should be more sophisticated than just screening out the ‘nasty’ sectors such as arms, tobacco and non-renewables. While climate change is a very real risk in the future, the ‘S’ and ‘G’ should still be a key consideration. Consider, for example, the backlash Ryanair suffered when reports of the poor labour practices for Ryanair staff came to light during strike action last year which led to several European pensions funds pulling their investments from the business.

The problem is that too many ‘greenwashed’ product specialists and sentiment surveys have diluted the message and detracts from a valid investment case. Fundamentally, true sustainable investing identifies and navigates risks towards future returns, which led to what is being hailed as the death of the US coal industry. In the UK, pension schemes are coming under greater scrutiny with regards to climate change risk, given that those enrolling in schemes today will have an investment horizon of around 45 years, during which this risk will certainly grow. With the Climate Power Plan and Paris Agreement in place with the aim of lowering emission levels, divestment away from coal is the beginning of a very real trend towards a more sustainable solution to the world’s energy needs.

What’s clear is that the discussion and understanding around ESG investing has developed enormously over the last few years, and communications around the topic must become more sophisticated. What the media, and ergo the industry, is looking to hear about is action and tangible solutions – backed by a solid investment case and hard data. Until the industry moves away from greenwashing products and communications, we’ll find far more people switching off from the conversation.