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The coronavirus pandemic could prove a tipping point for ESG, according to roughly two-thirds of the respondents to Responsible Investor’s recent survey on the outbreak and ESG.
And more than three-quarters say it helps the case for long-termism – although a narrow majority said no lessons have been learnt from the global financial crisis.
They are some of the top line findings of the snap survey, which ran last week as the sustainability investment field started to absorb the full implications of the crisis.
The survey was in a simple yes/no format, so there’s limited scope for detailed interpretation – but it gives a sense of ESG market sentiment.
But beyond the ‘binary’ Q&A section are the respondents’ comments, which give greater colour about how people are feeling and reacting. The survey had more than 300 respondents.
Here are some of the briefer responses to the survey:
Scrabbling to make ESG relevant / Digging a moat / Focusing more on beta risk / Taking surveys / Looking for a new job / Watch and see what happens with warm heart and cool head
The responses were far too numerous to repeat here in full, so what follows is just a taste of what you told us. Thanks to everyone who took the trouble at this difficult time.
Before we go on it’s important to note that this is not a scientific poll, just a snapshot from self-selected respondents. And it must be stressed that this was an anonymous survey.
Selection of comments to ESG/Coronavirus poll:
“Recognising that the changes we need go beyond anything the responsible investment industry has had the appetite for, to date. The activities of buy side investing make a marginal difference to the way economies are run.”
“Reassessing risk in investment portfolios; considering deferring interest payments on low interest loans owed to us; assessing which partners could use capital to have greater impact as real estate and other prices fall.”
“Isolating – and thinking politics, civil society matter more, and real essential workers are more important than most ESG people.”
“Talking to all of our portfolio companies on what they are doing in response to the pandemic (workforce, supply chain, communities, etc.) and focused on our long-term investment views (vs. the near-term only).”
“Re-iterating the importance of ESG best practice to our clients as we believe the competition for finance will become even more difficult.”
“Thinking about how those companies that signed the new BRT [Business Roundtable] statement should respond, especially with regard to exec comp.”
“Looking at restating expectations on tax practices post crisis – paying tax is critical.”
“Cringing every time I see folks celebrating pollution reductions related to Covid-19 shut downs. It is tone-deaf and won't do anything to advance the long-term sustainability agenda. I think overall this will hurt sustainability progress as countries and companies prioritize growth at any cost in the wake of this pandemic.”
“Examining our positions from an ESG / corona perspective. Examining how ESG can add quality and liquidity and still lead to relative outperformance. The oil price shock may be counter to decarbonisation plans.”
“Will soon turn to how we best respond to this, not the virus which is just the crisis trigger, but the economic implications for capitalism that turns to socialism when it suits and how will exec remuneration plans respond to the mass unemployment etc….We must look outside of our financial services bubble to all the people being so incredibly impacted by loss of work, housing, access to healthcare and the systemic implications for our investments.”
Responding to the survey on LinkedIn, activist investor Henry Woolf, Chairman of De La Vega, wrote that “far too much ESG work has been on risk avoidance ONLY which may be even further enhanced on the other side of CV-19”.
Note: An early version of the survey was sent out with repeat questions, apologies for this.