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- Majority of CEOs unsure that investors will drive corporate responsibility
- 86 per cent of CEOs ask investors to better price sustainability issues into valuations
- PRI Chairman responds by urging investors to ‘push further’ despite recent progress
NEW YORK, 24 June 2010 - As world business leaders met at a major UN summit in New York today, a new survey by Accenture and the UN Global Compact found that a large majority of CEOs believed investors must do more if the world is to reach the tipping point in creating a sustainable global economy. The survey found 86 per cent of CEOs wanted investors to more accurately value sustainability in their long-term investments.
Since its creation in 2006 the US$ 20 trillion UN-backed Principles for Responsible Investment Initiative (PRI) has been working to persuade mainstream investors to better integrate environmental, social and governance (ESG) issues into valuations and investment processes. The Chairman of the Initiative today welcomed the Accenture/Global Compact survey and called for companies and investors to work together to go, “beyond the tipping point.”
Donald MacDonald, Chair of the Principles for Responsible Investment Initiative said,
“ Time and again investors have seen how ESG issues can affect investment performance, and there is now a critical mass of institutional investors who know good management of these issues is an important factor in the long-term financial success of their investments. I expect the next decade to be an age of responsibility for capital markets.”
“If a company has poor corporate governance or persists with bad environmental management then it can, and should, affect the long-term valuation of the company. This is still a relatively new concept for many investors, but there are now leaders in mainstream markets developing the tools and models to integrate ESG issues and who can push the global capital markets beyond the tipping point on sustainability.”
Gavin Power, Deputy Director of the UN Global Compact said,
“The momentum is there from both companies and investors to create a sustainable economy. In particular it is remarkable that in just four years over US$ 20 trillion of assets have been signed to the Principles for Responsible Investment. I believe that sends a powerful message to the corporate world that the will is there from the investment community to build more sustainable capital markets. Companies and investors must now work together to identify and overcome the barriers that prevent sustainability from being permanently embedded into global business activity.”
The survey was conducted by Accenture on behalf of the UN Global Compact and launched at the Global Compact’s Leaders Summit in New York. The survey contacted 766 CEOs and top executives including face-to-face interviews with over 50 of the world’s leading business executives.
The specific question in the Accenture survey was: ‘How important will the following changes be in order to reach a “tipping point” where sustainability is embedded within the core business strategies of the majority of companies globally? In response: 86% selected, ‘Accurate valuation by investors of sustainability in long-term investments’.
The Principles for Responsible Investment (PRI)
The Principles for Responsible Investment, convened by UNEP FI and the UN Global Compact, was established as a framework to help investors achieve better long-term investment returns and sustainable markets through better analysis of environmental, social and governance issues in investment process and the exercise of responsible ownership practices. The Principles themselves, a full list of signatories and more information can be found at www.unpri.org
UN Global Compact
Launched in 2000, the UN Global Compact brings business together with UN agencies, labour, civil society and governments to advance ten universal principles in the areas of human rights, labour, environment and anti-corruption. Through the power of collective action, the Global Compact seeks to mainstream these ten principles in business activities around the world and to catalyze actions in support of broader UN goals. With over 7700 corporate participants and stakeholders from over 130 countries, it is the world’s largest voluntary corporate sustainability initiative. More at: www.unglobalcompact.org
United Nations Environment Programme Finance Initiative (UNEP FI)
UNEP FI is a unique global partnership between UNEP and the private financial sector that works closely with approximately 180 financial institutions to develop and promote linkages between sustainability and financial performance. Through regional activities, a comprehensive work programme, training and research, UNEP FI carries out its mission to identify, promote and realize the adoption of best environmental and sustainability practice at all levels of financial institution operations. More information: www.unepfi.org