Environmental, Social and Governance for emerging technology companies
ESG is becoming a growing issue for large cap companies as they compete for fund managers’ attention.
From the standpoint of the pre IPO companies the legislative and reporting framework has yet to be statutorily defined but a de facto compliance is required anyway from the perspective of either a founding round to the overall company’s presentation of its position to potential acquirers.
For larger companies, where increasingly extensive statements are required in the statutory financial accounts, the opportunity creates itself for such businesses to have an advantage over a pre IPO business in terms of not just PR but also as an expression of the company to the outside world for shareholders, customers and employees alike.
Mid-tier and smaller companies often neglect the thought processes around these issues with more conventional requirements requiring more immediate concern but at the very least more thought and time ought to be spent on ESG for future planning.
The wider opportunity though is to place ESG at the heart of the business purpose and strategy to allow businesses to focuses on all of its footprint from questions of inclusion to whistleblower programmes and from applicable regulator relationships through to ultimately shareholder and customer value.