In our latest Impact Chat, Social Invest Director, Luke Cross, spoke to Jon Lovell, Founding Director at ESG training and advisory consultancy Hillbreak. Jon shared his thoughts on the current ESG landscape, the challenges organisations are facing and whether companies are really making the progress they should be when it comes to sustainability.
Below are some of the key talking points discussed in the webinar.
“Everything has changed and nothing has changed”
Jon opens his remarks with a paradox that he has noticed within ESG practices. He suggested that the evolution of the ESG, sustainability and impact agendas has been both “really fascinating and really frustrating”.
He notes the various frameworks, legislation and regulation that have been introduced in the last decade but suggests many organisations have failed to progress.
He adds: “We are still having conversations today that we were having 15-20 years ago. In some ways, everything has changed while nothing has changed.”
Organisations are being overwhelmed
Discussing the various advancements in ESG and sustainability reporting, Jon describes the “sense of overwhelm” that many of his clients are dealing with.
He says it’s difficult to underestimate the impact the volume of reporting standards, information and changing legislation is having on the process of effective reporting.
Jon also highlights that this is an issue depending on where an individual sits within an organisation and whether they are given the time and space to consider their approach to ESG.
Challenges with perception of cost
Jon talks through another barrier he identified with the ongoing perception around risk and return.
He explains: “To go too far, too soon from a sustainability point of view could be very detrimental to investment returns.”
With this in mind, Jon says work needs to be done to avoid making sustainability and ESG unviable for the market.
“If we make this commercially unviable then then that’s a lose-lose situation,” he says.
The conviction deficit
Jon looks back on the market conditions in the last year and highlights what he deems a “conviction deficit” on ESG and sustainability.
He describes individuals and organisations that were previously very committed to the agenda “now suddenly getting much more cautious about statements that they make and how they preface them.”
Jon says that some are staying true to their missions but that others are receding which, he says, is understandable given the fine line many investors have to tread.
The importance of relevant skills
Asked about the solutions to barriers mentioned, Jon explains that there is a need to improve skills and knowledge around ESG
He notes that we are moving quickly to a point where there is more “role-specific, active learning” about what individuals need to do in their roles.
He says “One part of the solution…is around skills, knowledge and understanding, in order to be able to address these issues through mainstream roles.”
Click here to watch the Impact Chat in full.