Organisations considering implementing environmental, social and governance (ESG) criteria in decision making processes should not look at the direct cost of developing the framework alone when making the final assessment, according to the chair of ESG Research Australia Rob Fowler.
"The question a lot of organisations have is how much will this cost. The real question they should be asking is how much will this cost if you don't do it," Fowler said.
"Because how much is six months of lost revenue?" he added.
Fowler's comments were made at the annual ESG Research Australia awards ceremony held in Sydney yesterday.
Two main accolades were presented on the day with the Best Piece of ESG Research by an Individual Analyst or Team award going to Hamish Tadgell and Jien Goh from Goldman Sachs for the research item entitled Equity Strategy: Introducing the GS&PA Structural Leaders Framework.
Citi took out the award for the Best ESG Broking Firm for the second year running.
It was noted by the judging panel the research submitted for the awards was broader in its coverage of the issues.
"This is a welcome feature that we called for in last year's awards. Although final awards decisions were not easy to make, overall we were most impressed by reports that attempted to integrate ESG research into the mainstream," ESG Research Australia research evaluation committee chair Amanda McCluskey said.
Specifically views on materiality were eagerly welcomed.
"In this year's awards, it is clear that we are getting closer to research that has relevance to investment outcomes and can be applied and assessed in the same manner as other considerations that analysts look at in coming to their decisions," Fowler said.
