Editor’s note: ESG opportunities and UK obstructionism

The latest edition of our Sustainable Views newsletter.

Happy Friday.

“Has ESG lost momentum in the boardroom?” asks a report published this week by consultancy Spencer Stuart. The short answer would seem to be no, although there is a clear split between Europe and the US. Fifty-six per cent of Europe-based companies said they saw ESG as an opportunity, compared with only 30 per cent of US-based firms.

Hans Stegeman, chief economist at Triodos, a sustainable bank headquartered in the Netherlands, described the “step back from sustainability” by asset managers in the US as “extremely dangerous” when I spoke to him recently.

Despite pushback in the US, boards everywhere are, however, increasingly taking responsibility for sustainability issues, suggests the report. In 2019, only 20 per cent of companies in the US, UK and the EU said their full board oversaw ESG. In 2023 this figure had grown to 49 per cent. This trend is only likely to increase, in Europe at least, as regulation continues to demand more links between business plans and ESG.

Yet there is still plenty of work to do — 45 per cent of firms say they still need better insights around how their ESG goals link to overall company strategy.

The question of how companies should engage with large events in countries with less than rosy human rights records is the question being raised by two UK human rights lawyers. Acting on behalf of an anonymous client, barristers Ben Keith and Rhys Davies have written to a host of companies, including those that were partners and supporters of COP26 in Glasgow and COP27 in Egypt, calling on them not to get involved with COP28, to be held in the United Arab Emirates in December, and to use their corporate power to condemn human rights abuses.

You can read more about this story and plenty more ESG happenings in our news briefing, including the latest report from the UK Climate Change Committee, an advisory body, which warned earlier this week that the country’s progress towards a clean energy economy was worryingly slow.

Zac Goldsmith, minister for the international environment and long-time climate action champion, underlined this message on Friday. Announcing his resignation, he roundly criticised the government for its lack of international leadership on climate and nature and its failure to meet aid spending commitments on these issues.

“The problem is not that the government is hostile to the environment, it is that you, our Prime Minister, are simply uninterested,” he writes. Ouch.

Have a good weekend.