ESG is "an awkward acronym" that is "not compelling", according to Sarasin & Partners' Natasha Landell-Mills, who said the semantics behind differing terms for sustainable investing "need to be improved".
"People are pulling their hair out about the fact there is no one taxonomy for responsible investing. No, there is not, but I do not think that is necessarily a problem," the head of stewardship said.
"We need to improve the semantics and get better definitions, for sure. But the fact there is diversity is in a sense good because it means there is quite a lot of creativity, and quite a lot of doing things in an original way."
However, she describes ESG - or environmental, social and governance investing - as "three rather different sorts of things being shoved together" to create an "awkward acronym, which has now just become part of our lexicon".
"Often, in asset management houses, the people working on social or environmental issues are not the people working on governance issues, and they do not necessarily interact that much. So to put them into one bucket is slightly strange," she reasoned.
Not only this, Landell-Mills warned that to discuss ESG in a separate capacity to investing is "troubling", given that environmental or social issues should be as material to an investment case as any other factor.
"I find it hard to think of any issues to do with a business that are not going to involve people or the earth, because companies provide a product using staff - who are people - for customers - who are people, and the management - well, are people.
"It is slightly weird to me that 'mainstream investors' are not looking at this as well."
In addition, the head of stewardship said focusing on these three factors is "quite a small element of a much broader shift in investing that is needed".
As such, Landell-Mills' changed her job title from 'head of ESG' at Sarasin & Partners to 'head of stewardship' when she joined the firm more than six years ago, as part of a "key strategic shift" the firm was making in terms of its responsible investing capabilities.
"Adopting a long-term stewardship mindset when you approach investing goes far beyond ESG," she said.
"We will approach investments on behalf of our clients as owners. We will take a long time to do due diligence, including ESG. When we buy shares in a company, we will take on ownership responsibility in a diligent way.
"We will vote and we will think carefully about how we vote, but we will also actively engage in dialogue with companies where we believe it is important to do that. We will press for change wherever there are issues and we will be tenacious in doing that."