characteristics (Matsumoto, 2002) - Institutional ownership - Reliance on implicit claims with their stockholders - Value-relevance of earnings Natural disasters (such as hurricanes: Byard et al. 2007

are sustainably different from the underlying financial version of the agency theory. It assumes that each stakeholder is a part of implicit and explicit contracts that can contribute to a corporation

implicit in the methodology but have been clarified through notes Web pages that facilitate dissemination Research highlights on the credit implications of ESG trends and factors ESG- specific conferences or

does not constitute an implicit or explicit investment advice. The information provided herein is general in nature and does not constitute an advertisement of financial products in Switzerland pursuant

underlying asset(s) in which they invest – as discussed above. One aim of internal governance structures and the Principles in this respect is to minimise the frictional costs implicit in the investment chain

products (i.e., annuities), tax-efficient allocation decisions, and a portfolio optimization that includes a proxy for the investor’s implicit and/or explicit liabilities. Each of these five Gamma components

Investor Strategies for Incorporating ESG Considerations into Corporate Interactions www.blackrock.com www.ceres.org Century21st Engagement Investor Strategies for Incorporating ESG Considerations into Corporate Interactions [ 5 ] FOREWORD The Value of Our Voice ......................................................................................................................................... 1 How ESG Megatrends Are Shaping Valuation ...........................................................

implicit assumption behind the expected relation between future earnings and stock price is that markets possess information about future earnings. Prior research on the price informativeness reveals that