Insight Article Desktop Banner
April 20, 2022

How Accounting for Impact Can Deliver the Real Value of ESG

Insight Video Mobile Banner
April 20, 2022

How Accounting for Impact Can Deliver the Real Value of ESG


How Accounting for Impact Can Deliver the Real Value of ESG

Share Icon

April 20, 2022


In today’s market, the great majority of ESG metrics concerns operations: activities that happen within the company’s control. The next major milestone for ESG metrics, in our view, involves impact: how companies affect society and the environment through their employees, customers and products. This paper outlines a promising path for understanding and quantifying corporate ESG impact through impact-weighted accounts — line items on financial statements designed to supplement traditional financial reporting. Our analysis shows how positive impact, as disclosed in impact-weighted accounts, can be a material driver for key financial metrics and stock performance.

This paper draws from the findings of product-impact research sponsored by Calvert and conducted by KKS Advisors for, and in collaboration with, Calvert. KKS Advisors received compensation for the product-impact research completed in October 2021.

Article Team Image
As a leader in ESG investing for more than 40 years, Calvert is uniquely qualified to evaluate the complex range of risks and opportunities for the companies we invest in.

Risk Considerations

Investing involves risk including the risk of loss. There is no guarantee that any investment strategy, including those with an ESG focus, will work under all market conditions. Investors should evaluate their ability to invest for the long-term, especially during periods of downturn in the market.

The views and opinions are those of the author as of the date of publication and are subject to change at any time due to market or economic conditions and may not necessarily come to pass. The views expressed do not reflect the opinions of all investment personnel at Morgan Stanley Investment Management (MSIM) and its subsidiaries and affiliates (collectively the Firm”), and may not be reflected in all the strategies and products that the Firm offers.

This material is for the benefit of persons whom the Firm reasonably believes it is permitted to communicate to and should not be forwarded to any other person without the consent of the Firm. It is not addressed to any other person and may not be used by them for any purpose whatsoever. It expresses no views as to the suitability of the investments described herein to the individual circumstances of any recipient or otherwise. It is the responsibility of every person reading this material to fully observe the laws of any relevant country, including obtaining any governmental or other consent which may be required or observing any other formality which needs to be observed.

This material is a general communication, which is not impartial, is for informational and educational purposes only, not a recommendation to purchase or sell specific securities, or to adopt any particular investment strategy. Information does not address financial objectives, situation or specific needs of individual investors.

Any charts and graphs provided are for illustrative purposes only. Any performance quoted represents past performance. Past performance does not guarantee future results. All investments involve risks, including the possible loss of principal.

Prior to making any investment decision, investors should carefully review the strategy’s / product’s relevant offering document. For the complete content and important disclosures, refer to the full whitepaper "How Accounting for Impact Can Deliver the Real Value of ESG" mentioned above.


This is a Marketing Communication.

It is important that users read the Terms of Use before proceeding as it explains certain legal and regulatory restrictions applicable to the dissemination of information pertaining to Morgan Stanley Investment Management's investment products.

The services described on this website may not be available in all jurisdictions or to all persons. For further details, please see our Terms of Use.

Privacy & Cookies    •    Terms of Use

©  Morgan Stanley. All rights reserved.