MAJOR FORCES AT WORK- Gaining Clarity in the New ESG Era (Part 4 of 6)

By: Jonathan Neitzell and Bethany J. Schuttinga, PhD

Many would describe the ESG landscape as a blur in need of clear focus to achieve optimal outcomes for companies and investment groups. Currently, several ranking entities and tools exist to statically assess ESG performance for private and public entities. However, very few data offerings exist to alert asset managers, shareholders, or corporate leadership of risks in real time, or to offer remediation guidance. We see three primary pillars within this effort 1) Recalculating the Cost of Capital, 2) Rising Regulations, and 3) Community Activists Go Corporate. Today we explore Pillar 3.

PILLAR 3: COMMUNITY ACTIVISTS GO CORPORATE

A recent survey by Allianz found that a scant 15% of Americans recognize the term “ESG”. Despite low “Brand” recognition, 79% of those same survey respondents liked the idea of investing in a company that cares about the issues ESG represents. While the younger generation is leading the ESG push (64% are more likely to make investment decisions on issues they care about), the older baby-boomer generation lean 42% in support the efforts.

With nothing to lose, who wouldn’t support ESG-friendly companies? In fairness, a survey respondent pays little consequence for their answers. Yet, Millennials have broadly and consistently demonstrated a commitment to act on their views. A majority of the millennial generation believes that companies who care about social issues have better long-term success. It follows then that their lifestyle and investment decisions align with this belief.

This conscious consumer behavior among the millennial generation has influenced the investment world. According to The Deloitte Global Millennial Survey 2020, Millennial values will become more and more important as their purchasing power grows. Emphasizing this growing impact, by the end of 2021, millennials will represent 30% of all retail sales — an estimated $1.4 trillion a year.

To access the full paper, please visit?Anduril Partners.

Anduril?Partners is eager to help shareholders, corporates and businesses establish, monitor, and communicate ESG data to attract and retain capital, accelerate sustainable and responsible growth, and mitigate enterprise risk.?