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• Countries, regulators, the sustainable finance industry, and investors all have a responsibility to act decisively to build a more sustainable future. Companies’ efforts towards sustainability can be measured by ESG or the environmental, social and governance norms they follow.
• ESG can be explained as the quantifiable measure of a company's sustainability and societal operations, using standards that concern investors. These standards are used by companies to screen potential investments.
• ESG-focused business practices are now gaining more traction. Investment firms are increasingly tracking such performance. Graphic not to be read: In 2018, global assets under management incorporating ESG mandates grew to US$30.7 trillion to US$22.9 trillion in 2016. How can UK take the lead?
• There are many factors because of which UK is poised to be in a commanding position.
• Investment is crucial for any country and its economy, and sustainable and responsible financing can bring in a major change. And, UK has a major influence in the financial sector.
• A recent World Wide Fund for Nature report has highlighted that the ESG criteria is crucial. If companies and governments fail to integrate environmental and social factors into the financial aspect, the invested capital and the company or the government may face unnecessary and sometimes unseen risks.
• The UK is the fifth largest economy after the US, China, Japan, and Germany, and is a leading net exporter of financial services.
• Back in 2015, the London Stock Exchange was the first exchange to introduce a dedicated green bond segment. The UK became home to the first certified green bonds out of China, India and the Middle East, besides the first sovereign green bonds from the Asia Pacific region and the Americas.
