Cornerstone’s ESG Services are Helping Companies Improve Risk Management and Access to Capital
2020 is proving to be the year of Environmental Social Governance (ESG), and Cornerstone’s Strategic Advisory team is helping companies across industries to develop, implement and communicate their commitment to ESG principles. Fund managers and capital providers are insisting on greater ESG performance due to its link to value creation and greater access to capital. Therefore, companies are under increased pressure to comply.
In recent weeks, numerous developments are demonstrating the imperative for companies to show how they are operating in a sustainable and responsible manner, by embracing ESG principles. Examples include:
- BlackRock and State Street Global Advisors announcing in January that they will vote against management and reassess capital allocations when companies are not integrating ESG disclosure.
- Sustainable investing is accelerating with about $30.7 trillion held in investments in 2018, up 34 percent from 2016, according to the Global Sustainable Investment Alliance.
- ESG-focused equity funds have taken in nearly $70 billion of assets just over the past year, according to Emerging Portfolio Fund Research, Inc.
- Global sales of green debt securities continue to grow. New financial tools continue to flood into the market, including green bonds, sustainability-linked loans, sustainability bonds, social bonds, green loans, and sustainability-linked loans.
- “ESG is having a fast-growing impact on equity market positioning,” according to a Barclays report cited by Financial Times, noting that it is “likely contributing to widening the valuation dispersion between ‘winners’ and ‘losers’.”
“Interest in ESG is increasing and companies are responding to investors by taking action to improve ESG performance,” says Alanna Fishman, vice president of Cornerstone’s Advisory Services. “In order to be competitive for investor dollars in today’s environment and maintain their social license to operate, companies need to have quality ESG programs and be demonstrated leaders in their peer groups.”
“While some sectors of the economy are inherently under greater ESG scrutiny due to their operations and greenhouse gas emissions, companies that improve their ESG performance vis-à-vis their peers are finding their way into more portfolios,” Fishman said.
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Cornerstone is a leading provider of advisory services to companies seeking to develop and enhance their ESG programs, evaluate competitors, improve their scores, and communicate their results. We also work with financial institutions to evaluate their portfolios, improve ESG performance and reduce risk. Our services and clients span multiple sectors, including those with the greatest ESG challenges resulting stakeholders’ ever-increasing focus on climate.
For more information, please visit https://cgagroup.com/services/strategic-advisory-services-and-business-consulting/.