ESG Essentials for Corporates: what does it mean for your company?

Investors are increasingly basing their decisions on the scrutiny of environmental, social and governance (ESG) factors.

Sustainability, social good and corporate responsibility are key for forward-thinking businesses

Companies must embed these criteria in corporate strategy – or risk losing out.

How much do you really know about ESG? With a market volume of more than $30 trillion globally, this is a topic we should all be up-to-speed with.  And this new 25-part ESG Essentials for Corporates series aims to help you get there.  In it we’ll be taking readers on a whistle-stop tour, covering the key milestones of the last two decades. We’ll look at the latest news and views and offer practical guidance on how to build ESG into your corporate decision making and treasury frameworks.

Available boxset-style, the 10-minute reads will be released a handful at a time each month between now and year end. There will be a different focus each month:

We’ll also be publishing five ‘sector spotlight’ pieces, taking a look at how ESG is impacting specific industries.

When ESG investing was first touted, investors were hesitant. Their focus was shareholder value, not environmental and social or corporate governance.  

But we now know that ESG thinking – far from threatening financial performance – actually helps improve it.

Companies with strong ESG credentials consistently outperform those without, particularly in emerging markets.

According to finance company MSCI, ESG leaders on average outperformed by 14.4 per cent in emerging markets and 5.2 per cent in developed markets from June 2013 to February 2018.

To reap the benefits, businesses must carefully consider the different elements of ESG.

Put simply, environmental criteria include the energy and resources a company uses and the waste and carbon emissions it produces. Social factors look at how a company treats staff, suppliers and the communities in which it operates. Governance reviews the procedures behind corporate decisions and compliance, and the needs of all stakeholders.  

Today, investors know ESG makes good business as well as moral sense, leading to sustainable markets and better outcomes for society.

The threat to the global economy and business if climate change is left unchecked in increasingly clear. Meanwhile the transition to a low-carbon society promises enormous growth potential for those ready to address the climate crisis.

Corporate clients who would like to discuss this topic further should contact

Varun Sarda, Head of ESG Advisory

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