With growing regulation and stakeholder scrutiny within the sustainability space, it’s important to understand how Environment, Social and Governance (ESG) factors influence your business’s value, strategy and impact on society over time.
Regulatory developments are accelerating across Australia and the world, driven by increasing societal and investor demands for accountability. Investors and C-suite professionals are now aware of Sustainability Reporting requirements, such as the AASB S2 reporting effective as of 1 January 2025, and the need to have a sustainability strategy for key stakeholders. However, this forms just part of a larger shift across industries on increased awareness of key ESG topics and their management. As expectations rise, organisations that embrace responsible governance and environmental stewardship will be better positioned to thrive in a more transparent and sustainable economy.
Environment, Social and Governance (ESG) applies to all businesses, however capturing business externalities on society and the environment have been historically undervalued. A business cannot exist without impacting the air and the water it uses and returns, the experience of its employees and customers, and, through its governance, contribute to the standard of business practices in its regions of operation. Understanding how a company performs on these topics can uncover current issues, potential risks and opportunities for value creation.
Beyond regulation, good ESG is good business. Taking account of impact on internal and external stakeholders, energy efficiency, material circularity and the environment is not a nice to have, but a must.
As these considerations become increasingly pivotal for dealmakers in Australia, it is important for investors to feel confident in assessing transactions through an ESG lens. Our ESG due diligence process evaluates a company's environmental, social, and governance factors during the pre-investment phase to determine the overall maturity of the entity, manage potential risks, and identify opportunities.
