ESG has become part of the corporate mainstream in the last few years but most Australians don’t really understand the term.
. Demands for corporate carbon reduction, for example, meant many investors shied away from any association with “fossil fuels” on reputation grounds, insisting this makes financial as well as environmental good sense. Yet oil and gas companies have become the latest market stars in terms of investment returns over the past year. And the energy shortages and cost impact on often poorer households hardly fits neatly with the.
and other claims of sustainable or ethical behaviour. That is despite the elevated community expectation that companies should do the right thing by their customers and staff and communities and also invest in a responsible, sustainable fashion. The catch for boards and executives is that most people now take this as a given.According to Brian Tyson from SEC Newgate, this means they may punish a company if they suspect it is not behaving well or actually doing what it claims.
The result is over 40 per cent of those surveyed don’t trust what companies claim about ESG issues once the term is explained. A further 49 per cent are unsure – which doesn’t suggest companies are getting much consumer cut-through with current efforts.