Did you know that 85% of individual investors are interested in sustainable and ethical investing? Becoming ESG qualified increases your number of investors while also benefiting your community.
What Is ESG Investing?
ESG stands for environmental, social, and governance, and it’s a type of sustainable investing that’s been on the rise since 2019. It’s a set of operational standards that socially responsible investors use to find potential companies to invest in.
If a company meets ESG standards, you’re more likely to attract investors because ESG-qualified businesses are socially conscious and focus on making their community better.
ESG investors consider how a business impacts the environment. This includes things like:
- Air and water pollution
- Green initiatives
- Carbon emissions offsetting
- Waste management
- PPE recycling
- Amount of water use
- Implementing laundering services
- Decreased greenhouse gas emissions
- Renewable energy sources
Understanding the benefits of green initiatives, like recycling, will increase your ESG value.
Social qualifications focus on how a company manages its relationships with its partners, employees, and community. Being socially conscious increases the likelihood of ESG investors noticing your company. Social standards include:
- Fair labor practices within your business
- Sexual harassment policies
- Employee diversity (gender, sexual orientation, race, ethnicity, etc.)
- Data security
- Community involvement
- LGBTQ+ rights
- Fair wages
Governance refers to business operations and how ethical they are. It also includes:
- Accurate accounting methods
- Stockholder inclusivity
- Conflicts of interest
- Diversity of board members
- Ethical political contributions
- Internal corruption
- Corporate transparency
Most companies can’t meet every standard in the three categories, so ESG investors prioritize criteria with the most beneficial impacts. If your business meets most of these ESG qualifications, ethical investors will be interested in working with you.
How Can I Become an ESG Investor?
If you’re interested in getting a certificate in ESG investing, you’ll likely go through the CFA Institute, also known as the Chartered Financial Analyst Institute. You must complete a self-paced study course in 130 hours.
Then, you need to take a 100 question exam that lasts two hours and 20 minutes online or in a proctored testing center. The total cost of the online training course and exam is $665, and if you pass the exam, you receive 20 education credits.
ESG Investing Trends
ESG investing itself has become a trend in the past few years, but there are trends within ESG that help you optimize your investments.
The first ESG investing trend in 2022 is authenticity. Many businesses have become ESG focused because they know it’s popular right now—but investors see right through that. If your company is genuinely interested in ESG, integrate the criteria into your mission and business framework.
One way to increase your authenticity is by becoming ISO 14001 certified. ISO 14001 explains the requirements for an environmental management system (EMS) that a business uses to improve its environmental performance. Getting this certification shows investors you care about enhancing your business’s ESG efforts.
If you want to become ISO 14001 certified, you need to have records of your company’s sustainability efforts. Sustainability reports describe the amount of solid and liquid waste you’ve diverted from landfills and help you get this certification.
When you’re transparent with your investors, you increase their trust in you. ESG investors care about your business ethics and how you’re impacting the world around you.
Giving investors an ESG report that details your sustainability efforts is an excellent way to increase transparency with them, and it’s been increasingly popular to do so.
The “S” factor in ESG is becoming more important among investors. With the ongoing COVID-19 pandemic and constant rise in societal issues, many investors value businesses’ social efforts. Being aware of pressing topics and discourse surrounding those topics attracts ESG investors.
Implementing quality employee benefits during this time is a great way to draw an investor’s attention. People don’t want to invest in companies that aren’t properly taking care of their employees, especially during a pandemic.
Increase Your ESG Value Now
There are various things you can do right now to help you qualify for ESG—one of those things being laundering. Implementing a laundering service reduces the amount of PPE and absorbent mats entering landfills.
At Closed Loop Recycling, we provide sustainability reports so you can see the differences your company is making and apply for ISO 14001 certifications.
Our sustainability reports help you reach your ESG certification because they describe the amount of waste you’ve kept from landfills. Having this report increases your chances of an ISO 14001 and ESG certifications—and they come at no extra cost to our customers.
Laundering benefits the environment, and it’s also something ESG investors genuinely care about. If your business doesn’t have a laundering program in place, it’s time to get one, especially with the increase in ESG’s importance.
If you want to implement a laundering program and get sustainability reports, contact Closed Loop Recycling today to get started and optimize your ESG value.