The Impact of ESG
Environmental, social, and governance (ESG) criteria are a set of standards used by socially conscious investors to evaluate a corporation’s sustainability, ethical practices, and leadership. In our rapidly evolving business environment, it is critical for competitive firms to develop a dynamic and progressive ESG strategy, not only to align with the changing values of investors but also to reflect the priorities and needs of the broader world.
Our team of experts is here to assist with executing key ESG initiatives including:
Drafting statements to facilitate buy-in toward long-term goals (e.g., carbon neutrality) and managing projects to deliver on those goals.
Supporting stakeholder engagement, employee surveys, and focus sessions to align and inform an organization’s ESG guiding principles and strategy.
Defining the processes, procedures, and controls necessary to capture ESG data and implementing information technology solutions to automate these processes.
Partnering with stakeholders to create and automate processes for the collection and analysis of this data for subsequent internal/external reports.
Shaping external messaging by walking the stakeholders through the data collection and analysis necessary for publishing an annual sustainability report.
Defining Materiality Assessment
Defining which ESG considerations are material to the business is the first step a firm should take on its ESG journey. MorganFranklin helps firms identify material topics by interviewing key internal and external stakeholders, benchmarking against competitors, and reviewing industry-specific guidance from international NGOs.
Key indicators of topic materiality include:
- Direct financial costs such as fines and settlements
- Regulatory and policy drivers such as EPA and OSHA regulations
- Industry norms and best practices such as green building practices and certifications such as LEED and Energy Star
- Social trends and stakeholder perception such as the use of single-use plastics in packaging and circular economy trends
- Opportunities for innovation arise when firms offer integrate environmental and social purpose into their business models
Both public and private investors are accelerating their demands for sustainability information from companies. The International Sustainability Standards Board is in the process of issuing guidance, and the SEC is not far behind! MorganFranklin consultants understand the complex international ecosystem of sustainability frameworks and standards and can assist company leaders in selecting the appropriate path forward based on their specific operations and growth trajectory.
ESG Due Diligence
Leading investors today are incorporating ESG factors into their decision-making processes. The Principles for Responsible Investment (PRI) organization now boasts 4,375 signatories, representing US$121tn of AUM. To access this capital, GPs must demonstrate how they assess potential investments. Retain MorganFranklin’s experienced PE Services team to support your IT, Operations, Financial, and ESG diligence efforts.
MorganFranklin’s End-to-End ESG Offerings
See how MorganFranklin’s strategic ESG advisors can guide you through defining an ESG strategy, selecting the material topics, and establishing appropriate governance for program accountability.