Amongst 1) Black-Litterman model, 2) Brinson attribution model, and 3) risk factor attribution, which is/are metric(s) to measure the effectiveness of ESG integration?

The Brinson attribution model is primarily aimed at determining the performance of a portfolio relative to its benchmark, focusing on asset allocation and manager selection. While it provides insights into performance drivers, it does not specifically address ESG integration or effectiveness.

Risk factor attribution, on the other hand, is relevant for measuring the effectiveness of ESG integration because it analyzes the contributions of different factors—including ESG characteristics—to portfolio performance. This helps investors understand how much ESG considerations influence returns compared to traditional factors.

The Black-Litterman model is a sophisticated asset allocation framework that can incorporate views on expected returns based on ESG criteria, thereby allowing for some measure of effectiveness regarding ESG integration when return expectations are aligned with sustainability goals.

Given this analysis, it follows that the selection of metrics to assess the effectiveness of ESG integration focuses appropriately on risk factor attribution due to its direct link to understanding the impact of ESG factors on performance. The Black-Litterman model also plays a role in this assessment by allowing enhanced returns that incorporate sustainability views. Thus, the correct emphasis on measuring ESG effectiveness includes elements of risk factor attribution and the potential insights from the Black-Litterman model.