Doha: In its latest academic contribution, the Al Attiyah Foundation offers an in-depth look at environmental, social and corporate governance (ESG) and how it has changed the inner workings of some of the world’s most important institutions.
“Guidebook on ESG” is a 113-page report, written by the Foundation’s in-house experts with decades of experience in the energy industry and sustainability, which aims to help policy makers, investors, companies and stakeholders to understand and navigate ESG.
ESG criteria are a set of standards for a company’s behavior used by socially responsible investors to screen potential investments. Environmental criteria take into account how a company protects the environment, including corporate policies on climate change. Social criteria look at how a company manages its relationships with its employees, suppliers, customers and the communities where it operates. Governance deals with the direction of a company, executive compensation, audits, internal controls and shareholder rights.
The term was coined in 2004 when a report commissioned by the United Nations, entitled “Who Cares Wins Connecting Financial Markets to a Changing World”, called for “better consideration of environmental, social and corporate governance factors (ESG) in investment decisions.
Although ESG struggled to gain traction with investors and institutions in the years immediately following the UN report, the term is now ubiquitous in the corporate landscape. In May 2021, he was mentioned in nearly a fifth of revenue calls, spurred by the urgency to tackle climate change, as well as some recent events, such as a widespread protest against racial discrimination and the outbreak of the COVID-19 pandemic.
Investing within an ESG framework is now the fastest growing segment of the asset management industry. ESG fund assets grew 53% year-on-year to $2.7 trillion in 2021, according to data provider Morningstar.
The private sector, especially large corporations, is increasingly realizing that sustainable business practices embodied by a commitment to ESG are no longer just a marketing tool, but a key to creating value and competitiveness. long term in the complex global economy.
The “ESG Guide” examines the key drivers shaping the growing momentum for ESG, including growing pressure from stakeholders; business profitability and competitiveness; demand from institutional investors and consumers; the quest to build a good corporate reputation and relationship with customers and government regulations.
Chairman of the Board of the Al Attiyah Foundation and former Minister of Industry and Energy, HE Abdullah bin Hamad Al Attiyah believes that the publication will be of great benefit to members of the business community.
He said: “This publication is an authoritative account of the benefits an ESG assessment can bring to a company’s stakeholders, and highlights the importance it now plays as investors consider the impact environment of an organization in their decision-making.
“I am sure that Foundation members, partners and other interested parties will find the ‘ESG Guide’ a reliable resource, as the environmental footprint left by countries and organizations will be even more focused in the coming months. and years to come,” Al Attiyah said. added. To download the “ESG Guide” for free and to gather expert opinions on the energy industry and sustainability, visit the Al Attiyah Foundation website at http://www .abhafoundation.org