ESG and Social Value
ESG is a term I’ve only been vaguely associated with in the past, it relates to Environmental, Social and Corporate Governance in particular associated with financial investment. For those of us looking to increase the social impact of our activity it presents real opportunity to differentiate ourselves. Sectors such as affordable housing which bestride the private and third sectors due to their social purpose but rely on private investment, can really strengthen their appeal to investors looking for more sustainable investment opportunities.
Some may have considered ESG requirements in the past as a minimum threshold (box ticking) requirement, but as the economy evolves and investor priorities change, these have become increasingly important in some cases investors are providing financial incentives to achieve agreed ESG outcomes.
Providers in the social housing world have produced a White Paper in recognition of the importance to the sector of private fiance and in recognition of the sectors USP in this agenda due to its social purpose, strong governance and environmental consciousness. This also attempts to standardise a series of criteria upon which to seek and evaluate an ESG submission.
Those of us seeking to increase the social and environmental impact (through strong effective and transparent governance) of our actions should welcome the increased focus of ESG in investment decisions. We should seek to ensure they are real points of differentiation and that organisations leading change by really pushing for stronger ESG requirements are supported accordingly.
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