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ESG Valuation Considerations – Top Down or Bottom Up?

Value Scope

Alpha is an adjustment made to the Capital Asset Pricing Model (“CAPM”) as part of the calculation of the Weighted Average Cost of Capital, or “WACC.” The Multiperiod Excess Earnings Method, (“MEEM”) has more promise. It is an income approach, using discounted cash-flow analysis.

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ESG A Valuation Framework

Value Scope

Alpha is an adjustment made to the Capital Asset Pricing Model (“CAPM”) as part of the calculation of the Weighted Average Cost of Capital, or “WACC.” The Multiperiod Excess Earnings Method, (“MPEEM”), has more promise. It is an income approach, using discounted cash-flow analysis.