A recent United Nations meeting on responsible business called attention to a company’s ethical performance as an important consideration for investors deciding which companies to back.

Citing findings from a recent survey by Goldman Sachs, Ling asserted that companies with strong ethical standards outperform the market. For example, companies on an ethical list compiled by Goldman Sachs outperformed the MSCI World Index by an average of 25 percent. 72 percent of these companies were also found to have outperformed their industry peers.

Anthony Ling of Goldman Sachs International insisted that a company’s “ESG” performance (its environmental, social, and corporate governance) can provide an advantage to the company over competitors because these factors are sure to pay off with customers and employees.

Ling stated that these factors, combined with careful consideration of the company’s place in its industry, competitive advantage, and financial performance should all be taken into account when evaluating investment options in mature or emerging markets.

Commentary: We were thrilled to see this report. Our research at Ethisphere has found similar results. The Ethisphere Ethics Index, which tracks the publicly traded components of the annual World’s Most Ethical Companies Ranking, OUTPERFORMED THE S&P BY MORE THAN 2:1 over the five-year period that ended March 31, 2007.