The struggle of these last two years, along with the need for real change in how we impact the people around and the planet, has caused a shift in society. Not only have we seen a shift in our personal lives, but also in the demands we make of the businesses we work for, interact with, or run.
It is crucial that both new and established organisations incorporate strong ESG values into their culture and business ethos. No longer are we content to just pay lip service to ESGs (CSR) predecessors. It is crucial that we as individuals and businesses do everything we can to benefit the environment and society in the present and the future. We must hold ourselves and those around us accountable, and at a higher level.
Sustainable investing assets reached $14.1trn Europe in 2018 and $12trn USA in 2018, with the latter expected at $35trn by 2025. Globally, the percentages of institutional and retail investors who apply ESG principles in 25% or more of their portfolios has increased from 48% in 2017 to 75% in 2019.
It is a positive step in the right direction. ESG has many benefits for any organization. Converge, Scotland’s largest university-based company creation programme, has actively integrated these principles into its training and business support.
Over the course of our 11-year-old history, we have witnessed organisations change their approach to ESG. Scottish universities have been at the forefront of ESG innovation for many years. They have embraced and embedded these values into their core. We have seen many academic entrepreneurs who are part our alumni community working to create social change. This includes SolarisKit who is involved in solar energy innovations with strong emphasis on energy-poor nations, as well Cyan Forensics who created a technology that can identify child sex abuse and terrorist materials. Earth Blox and others like them reinforce their responsibility to the larger world by democratizing Earth observation, giving incredible insights into how our world is changing.
This is what I believe makes such businesses strong. They place impact at their core. This allows them to retain and attract talent in difficult times. This is especially important during the Great Resignation of 2022, when people flock to organisations that are true to their values and purpose.
Investors are increasingly looking for companies that have ESG credentials. SIS Ventures, our strategic partner, invests in mission driven enterprises that address society’s most pressing needs and challenges. These organisations are crucial in engaging with innovators at all levels of their development and ensuring that they adopt an ESG-focused model to achieve success.
SolarisKit and Cyan Forensics are able to offer a distinct advantage over traditional profit-driven organisations. They have the desire to make positive changes and the ability to constantly evolve and innovate. I strongly believe it is important that all new businesses, whether they are in the ESG or not, ensure that their ESG agendas are well-considered and strong. It will not only help companies attract talent but also attract investment and customers.
Claudia Cavalluzzo is Executive Director of Converge
