EU law will compel firms to come clean on ethics

Investors looking for companies with good environmental, social, and governance track records will find the job easier after European politicians ruled that thousands of firms must reveal their performance as corporate citizens.

Trillions of dollars of pension fund, insurer, and mutual fund money is already invested in firms that are screened for a range of ethical criteria because of evidence that such firms tend to be more profitable in the long-term.

Until now, the release of information has been patchy. The new legislation, though watered down from initial proposals, will compel around 6,000 mostly listed firms across the EU to provide details on how they tackle issues such as bribery and human rights.