The ESG Landscape and Economies in Transition
Investor Update in partnership with Cision have published their latest whitepaper, The Corporate ESG Guide: The ESG Landscape and Economies in Transition. Written by Elena Zharikova from the ESG Advisory team, and Andrew Archer, Head of ESG Advisory at Investor Update, the paper is a comprehensive assessment of the way that the industrial world is transitioning towards low carbon intensity.
More than 50 interviews of the leading ESG protagonists were conducted including corporates, investors, regulators, advisors and rating agencies from five continents and all industry sectors, including Ford, Adobe, Tesco, Coca-Cola FEMSA, Etsy, Enel, Orange, Sanofi, Gazprom, Goldman Sachs, Citi, Credit Suisse, UBS, SASB, TNFD, the FRC and the IMF.
This has produced the most extensive and complete view of the experiences, challenges and successes of these entities with the resources and the responsibility to deliver a just and sustainable transition. The result is a Landmark Research White Paper on the ESG Landscape, focusing on Economies in Transition which frames the nature and urgency of the global threat presented, mirrored by the way industry is rising to meet that challenge and looking to prosper in the process.
The Corporate ESG Guide: The ESG Landscape and Economies in Transition profiles and evaluates the global and national transition goals alongside the significant regulatory developments from the EU, the UK and the US, with progress being made very much in that order. This is contrasted by the major industry trends in ESG and how that has been impacted by the acceleration of ESG investing and the wide-ranging corporate response. Challenges and inhibitors to progress abound but there is evidence of collective desire to create and accelerate change in the behaviours of companies, consumers and investors. These are the stakeholders with the substantive, far-reaching power to secure our collective futures by building ‘Economies in Transition’.
Key Topics Include:
- The Mountain Stakeholders are Climbing with Inconsistent Success
- Corporate ESG Integration and Creating Sustainable Targets & Goals
- Governance and Tying ESG Performance to Executive Remuneration
- ESG Data & Ratings – Frustrations driving a different kind of transition
- Managing Risk in the International Supply Chains
- Protecting Biodiversity through Corporate Impact
- The Relative Value of Voluntary Disclosure Frameworks
- ESG Disclosure vs Real-World Impact – is this style over substance?
- Driving Change Through Direct Investor Interaction and Engagement
- The Impact of ESG on Access to Markets and the Cost of Capital
- What Will The ‘Just Transition’ Look Like and Will It Come Too Late?
Key whitepaper findings and conclusions:
- There is a lack of clear transition pathways for some key sectors, which is deterring some corporates from setting specific climate targets. This, combined with a misalignment of incentives within corporate leadership, is creating a conflict between long-term climate considerations and short-term market pressures.
- Investors face a similarly conflicted challenge in reconciling the implications of decarbonisation commitments and their duty to deliver investment returns.
- The lack of common understanding around key ESG concepts is a persistent obstacle to their measurement and application in investment decision-making, compounded by ESG-linked investment products considering divergent aspects of ESG performance and data.
“The challenge is the consistency of many different business models and exposures with the low carbon economy. There have been many net-zero commitments from companies and asset managers over the longer time frame, all of whom are now trying to figure out concretely the credible path to get there. It is about evolving or developing new strategies that align to net-zero and decarbonisation objectives while still delivering for investors on the risk and return that they expect and need.” – Andrew Lee, head of sustainable and impact investing at UBS Wealth Management