Recently, there has been debate among corporate managers, board of directors, and institutional investors around how best to incorporate ESG (environmental, social, and governance) factors into strategic and investment decision-making processes. In this Closer Look, we examine a framework informed by the experience of ValueAct Capital and include case examples.
- What is the investment horizon prevalent among most companies today?
- Do companies miss long-term opportunities because of a focus on short-term costs?
- How many companies have an opportunity to profitably invest in ESG solutions?
- What factors determine whether a company can profitably invest in ESG solutions?
- Can investors earn competitive risk-adjusted returns through ESG investments?
- If so, how widespread is this opportunity?