Ethical companies winners in past five years
Environmental, social and corporate governance (ESG) factors are forcing a revaluation of how we look at investment and risk opportunities, an industry executive has said.
In a panel discussion on corporate governance at the Conference of Major Superannuation Funds (CMSF) on the Gold Coast, Erik Mather, managing director of investment researcher Regnan, said ESG factors "are recasting the way we look at investment and risk opportunities".
"Workplace health and safety, it's about operational risk," Mather said, adding that fund managers should be looking at this as a signal of risk. He noted also that corporate governance is "all about alignment" and that ethics, culture, and risk aversion were important in times of instability.
"The only positive thing to come out of the global financial crisis is that these [ESG factors] are getting attention," he said, adding that the call for action is clear.
In his presentation, Mather said companies investing in ethics as a concept over the last five years have made money; that is, where there was an ethics and culture policy, risk identification or oversight, and remuneration of the company being invested in.
Mather said looking at governance is obvious from a fiduciary perspective. It's about risk management, he said.
Recommended for you
With the final tally for FY25 now confirmed, how many advisers left during the financial year and how does it compare to the previous year?
HUB24 has appointed Matt Willis from Vanguard as an executive general manager of platform growth to strengthen the platform’s relationships with industry stakeholders.
Investment manager Drummond Capital Partners has announced a raft of adviser-focused updates, including a practice growth division, relaunched manager research capabilities, and a passive model portfolio suite.
When it comes to M&A activity, the share of financial buyers such as private equity firms in Australia fell from 67 per cent to 12 per cent in the last financial year.
