Almost half ( 49%) of investors globally express willingness to divest from companies that aren’t taking sufficient action on ESG issues, 79%, say the way a company manages ESG risks and opportunities is an important factor in their investment decision making, according to PwC 2021 Global Investor ESG Survey.
”Investors are simultaneously focused on short-term results as well as longer-term ESG issues that can create both risks and opportunities for their investments. They realized that ESG became part of the corporate strategy and if they don’t see that commitment, they won’t hesitate to take action, even reorienting some investments to other companies”, said Monica Movileanu, Partner and ESG Leader, PwC Romania.
Although most investors are likely to take action if companies are not doing enough to address ESG issues, most also say that they don’t want a company’s action on ESG to significantly, if at all, impact their investment returns. The vast majority, 81%, said they would accept no more than one percentage point less in investment returns for pursuit of ESG goals; nearly half, (49%), were unwilling to accept any reduction in returns.
Climate is the leading ESG consideration for investors surveyed, followed by ensuring worker health and safety and improving workforce, diversity, equity and inclusion.
Investors want more robust and trusted ESG reporting
Our survey highlighted a number of deficiencies in current ESG reporting: only one-third of investors, on average, think the quality of the reporting they’re seeing today is good enough. Simply put, much of today’s ESG reporting lacks relevant, timely, complete and comparable information – such that stakeholders cannot easily differentiate between companies on ESG-related performance – making capital allocation decisions difficult.
Thus, 83% surveyed said it is important that ESG reporting provide detailed information about progress toward ESG goals and 75% think it’s important that reported ESG-related metrics are independently assured.
About the Survey
In September 2021, PwC conducted an online survey with 325 investment professionals from 43 territories. We also conducted 40 in-depth interviews in 11 territories during September and October 2021 with investors and analysts having more than a combined USD 11.6 trillion assets under management. The respondents to the online survey were predominantly asset managers (53%) and analysts (34%).
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