The rise in environmental, social and governance (ESG) criteria has shown an undeniable increase in consumer awareness and interest. Withstanding the test of time, it has become more and more evident that an overwhelming majority of 94% of consumers find at least one of these criteria to be “important”. This was recently highlighted at Timeline’s Adviser 3.0 Changing Agents conference held on the 18th of May, which was discussed by Samantha Duncan, CEO and founder of Net Purpose.
The concept of ESG has surged in demand over the last decade due to its multiple advantages. This includes the boost to social equity as well as an uptick in business confidence, stemming from its role in reflecting sustainable growth both for businesses and the environment. Recognising these advantages, clients and investors of the likes of CCLA are gradually focusing towards sustainable investments, creating an opportunity for the industry to expand its ESG appeal.
Along with this growing interest into ESG, leading banks such as HSBC have upped the ante by introducing their own set of standards& frameworks. Last year, the banking giant rolled out their ‘HSBC Climate Transition Financed Framework’, which is designed to tackle the societal pressures of climate change. This has not only allowed the banking organisation to evaluate its own climate objectives, but has established a new set of standards for different ESG strategies.
It is clear that ESG criteria has gained momentum and is an imperative factor in driving customer purpose when it comes to both sustainable investments and augmented financial performance. As a result of this, a consensus between policy makers, financial institutions, and investors is beginning to form in the pursuit of better long-term returns for everyone involved. Ultimately, ESG criteria is here to stay, with lasting effects for everyone who is part of it.