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Dustyn Lanz, Senior Advisor with ESG Global Advisors Inc., was interviewed by The Globe and Mail about the relationship between ESG and financial performance. An excerpt is provided below, and the full article is available here.
“ESG performance is a useful indicator for a company’s quality of management,” says Dustyn Lanz, senior advisor with ESG Global Advisors in Toronto. “If a company is well governed and manages its exposure to social and environmental risks, there’s a good chance it’s a better managed company overall. And if a company is ignoring ESG risks, such as the effects of climate change, they’re putting their competitiveness and social licence at risk.”
There is no uniformity around ESG ratings and scores. Still, according to McKinsey research, the majority of ESG-focused investments outperform the broader market.
Mr. Lanz says companies with a robust ESG framework have a lower cost of capital and better access to debt, which is due to their lower risk.