By Nicola Robins (30 September 2013)
Hosted by the JSE, eight listed companies presented their environmental, social and governance (ESG) credentials to a large group of local and foreign investors.
They included leading lights on the JSE Socially Responsible Investment Index (SRI) such as Altron, Exxaro, Woolworths, Anglo American, Tongaat Hulett and Old Mutual Group.
Here are a few general reflections:
- Significant attendance by foreign investors suggests growing global interest in the responsible investment arena. Though most were probably out for the UN PRI event to follow, the audience stayed seated throughout the day and questions were insightful.
- A wide range of approaches – despite the JSE providing guidelines, apparently – shows companies still unsure on the most effective way to communicate their ESG response to investors.
- With some exceptions, sustainability frameworks tend to be all-encompassing lists rather than focused on clear ESG value drivers.
- Companies are not distinguishing between ESG initiatives that respond to compliance / risk and those that have potential to differentiate them in the market place. This is where most of the presenters lost an opportunity to distinguish themselves to a generally positive audience.
- The tone of the presentations tended towards PR: lots of examples of ‘what we’re doing’ rather than where the real tensions and challenges are.
- While most companies are happy to say they are ‘learning’ and ‘on a journey’, few are prepared to talk to the serious challenges they face in getting traction for many of these initiatives internally.
- Investors are starting to ask the right questions: topics like labour issues, use of garnishee orders, internal Gini co-efficient, energy investments and governance tended to get more airtime in questions than they did in the presentations.
Well done to the JSE SRI for hosting, the GEPF for collaboration and sponsorship, and all those who attended.