At Sustainability LIVE London last year, Neil Perry, Head of Multimedia at BizClik, was joined onstage by two experts: Faye Bennett-Hart, Chief Sustainability Officer at Morelli Consulting Ltd and Sören Müller, COO at Longhouse Water15.
The discussions centred around the integration of environmental, social, and governance (ESG) criteria in investment strategies, the importance of ESG in financial decision-making, and challenges and opportunities in sustainable and ethical investment.
The contents of The Sustainable & Ethical Investment Forum
Bennett's Key Points
- ESG Integration in Investment Decision-Making: She emphasised the importance of incorporating ESG criteria right from the beginning of the investment process, especially during due diligence, rather than treating it as an afterthought.
- Measurement and Reporting: She discussed the need for comprehensive ESG measurement, including aspects like carbon and water footprinting, and the challenges of transparent and effective communication to avoid issues like greenwashing.
- Educational and Engagement Challenges: Bennett highlighted the need for increased engagement and education within organisations, including CFOs, to prioritise sustainability issues.
- Long-term Investment Horizon: Bennett underscored the importance of longer-term thinking in financial sectors to address climate change and other sustainability issues effectively.
- Fiduciary Duty and Sustainability: Bennett addressed the debate around fiduciary duty, advocating for a focus on sustainability as a core part of fiduciary responsibility, particularly in the context of achieving net zero goals.
Müller's Key Points
- KPIs and Impact Measurement: Müller stressed the importance of both quantitative and qualitative Key Performance Indicators (KPIs) in evaluating the impact of investments, using Water One 50’s goal to provide clean drinking water as an example.
- Aligning Impact with Profit: He discussed the need to align impact and profit, creating shared value ecosystems where stakeholders, including investors and beneficiaries, align their interests for mutual benefit.
- Transparency and Education: Müller emphasised the role of transparency in communicating the actual impact created by investments and the need for education across various stakeholders to raise awareness about sustainability issues.
- Challenges in Scaling Sustainable Investments: He agreed with Bennett on the educational and engagement challenges and added the issue of investment time horizons, suggesting that most venture capitalists focus on shorter time frames, which can be a barrier to achieving significant sustainable changes.
Both Bennett and Muller agreed on the importance of ESG in investment strategies, emphasising the need for better education, engagement, and long-term thinking in the financial sector to promote sustainable and ethical investments. They also discussed the challenges in measuring and communicating the impact of these investments and the necessity of addressing these issues to make significant progress in sustainable development.
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