A mining engineer holds up a tablet to a rock quarry. Credit: Morsa Images/iStock.
As the Environmental, Social and Governance (ESG) wave continues to build around the world, many are wondering what this year has in store. According to Blackrock, the world’s largest asset manager, investors plan to double their allocations to sustainable investments over the next five years, and 20% say that Covid-19 is accelerating those allocations.
The pandemic has greatly intensified the growing societal concern over rising inequality and the negative impacts of human activity on our planet. Investing towards good for the planet and society is now front and centre, and the demand for transparent disclosure on ESG performance is not letting up. Over half of institutional investors are looking for companies to disclose more details about their social or “S” factors, according to RBC Global Asset Management’s annual Responsible Investment Survey.
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As environmental, social and governance (ESG) factors have
become a growing focus for companies and their shareholders,
financiers, employees and other stakeholders, they have also become
increasingly important to the success of M&A transactions.
ESG factors are now seen as important value drivers for
dealmakers, as well as being essential to corporate values and
reputational expectations. Effective diligence, evaluation and
management of ESG considerations are critical steps for parties to
take to mitigate risk, achieve beneficial outcomes and synergies,
and successfully execute transactions. This article explores key
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Here’s why ESG investing will impact the oil and gas landscape in 2021.
Environmental, Social, and Governance (ESG) investing is rapidly becoming one of the most visible and durable megatrends in the oil and gas industry as momentum builds behind efforts to promote renewable energy, sustainability, and the energy transition. The pressure of ESG is being felt throughout the U.S. oil and gas value chain with the upstream sector facing the most scrutiny for its impacts on the environment, and the midstream for its social impact and governance structure.
Even amid the COVID-19 pandemic, which has had rattled global economics around the world in such a short time, investors are viewing the crisis as a major turning point for ESG investing in the long term alongside traditional financial metrics. In the energy industry, the perception of ESG has shifted from a nice-to-have feature to a must-have pre-requisite as it’s greatly influencing the way investors invest in the industry, which