Interesting chart from JPMorgan showing the historical credit spread difference between ‘best’ and ‘worst’ in class European Investment Grade & High Yield credits, using ESG scores.

It shows that ‘worst’ in class credits have traded wide to ‘best’ in class, especially during times of distress. However, how much of this is due to the underperformance of the Financials sector in 2015/16 and 2020 rather than ESG factors? There is still plenty of work to do in credit markets to deliver true ESG related alpha. #fixedincome #sustainableinvesting #assetmanagement

Source: JP Morgan