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Middle market trend watch: ESG

Measuring responsible business practice

INSIGHT ARTICLE  | 

Environmental, social and corporate governance measures demonstrate a company’s commitment to ethical practices and sustainability, and the ranks of companies benchmarking with ESG is growing. Stakeholders ranging from customers to suppliers and investors use ESG criteria to help track everything from the commitment to environmental stewardship to employee, supplier and community relationships, how well the business leads and governs itself—even its market valuation. According to the Forum for Sustainable and Responsible Investment, ESG-managed investments represent $11.6 trillion of alternative assets, or one in every $4 invested, up 44% from $8.1 trillion just three years ago.

Are middle market companies also leveraging ESG strategies? In RSM’s fourth quarter Middle Market Business Index survey, we asked business leaders about this trend. Note the findings below. 

 

KEY TAKEAWAY:

While many middle market businesses are leveraging ESG strategies and seeing the value, more engagement is needed and companies should strive for consistent tracking efforts. To improve ESG and overall corporate social responsibility initiatives, companies should assess existing ESG and social responsibility strategies, identify new programs and charitable partners when needed, set metrics and measure, and communicate successes on a consistent basis. 


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