ESG: Driving Financial Growth and Shaping Stakeholder Expectations
The importance of ESG (environmental, social, governance) as reflected in the five fold increase of internet searches since 2019, indicating its growing significance. Companies across different industries have consistently been improving their ESG practices by allocating more resources. Previous blogs have discussed the effect of ESG on investing. In this context, it is worthwhile to note also that the ESG market will double this year. ESG is also likely to significantly impact not just investors but also consumers and stakeholders. It is now an accepted industry knowledge that the companies that follow ESG best practices have higher financial growth and better performance. In comparison, companies that performed poorly on ESG experienced a higher cost of capital and higher volatility.
