Util's inaugural report 'How SDG is ESG?' won ESG research of the year, North America, for its review of the entire US fund market based on social and environmental impact.

In its report, Util observed that ESG funds have no significant additional positive impact compared to non-ESG funds, as ESG funds rely on ratings that set the bar for corporate citizenship "abysmally low", despite charging a premium.

Util found that most sustainable funds, and the data underpinning them, focus on relative performance based on self-reported data, rather than the absolute impact of business activities on social or environmental goals.

Util found a marginal 2 percentage point difference on a -100 to +100 scale, as reported in Environmental Finance.

In the report, Util recommended next steps for asset managers, including a greater focus on the total value chain of any sustainability theme and how machine learning can be used to untangle these patterns.

Patrick Wood Uribe, CEO at Util, said: "The report draws attention to distinguishing between impact and ESG."

Commenting on the future of ESG, Uribe said: "I think the key thing is to be very data driven and comfortable with the fact that it's a complicated picture. We manage complex decision making all the time as humans, so there's very little reason not to do it in this case. Also, that's where opportunities lie. So, there's a lot of upside to recognising that complexity."