In brief: ESG is going slow in private markets, say CFOs

Talk about environmental, social and governance implementation is not necessarily being backed up by action, with one-fifth of global private funds’ chief financial officers saying that their firm is yet to start making ESG part of its investment process.

A report from Netherlands-based administration services provider Intertrust Group and Global Custodian magazine has found that while 95 percent of CFOs realise investors view ESG as being important, only 28 percent have completed ESG integration processes.

More than half of CFOs (57 percent) said constraints relating to cost and resource were the most challenging aspect, while the complexity of managing multiple sources of ESG data was cited by 51 percent and quantifying and monitoring the implementation process by 48 percent.

But while there are certainly issues to overcome, Intertrust warns that funds “must either meet the demands or face significant competitive disadvantages and possibly regulatory pressures in the future”. The study canvassed the views of more than 300 global CFOs in more than 30 jurisdictions.