Elevating Corporate Value: The Art Of ESG Integration In Securities And Investment

J. Sai Vimalananthi, Graduate from Symbiosis International University & CS Finalist from ICSI

ABSTRACT

This paper aims to analyze the critical importance of incorporating the environmental, social and governance related factors to survive in the corporate landscape. ESG consideration is a two-way street, where the investors play a significant role as the companies themselves. Their responsible thinking, due diligence and informed decision-making will help set the entire cycle on the right track. As investors begin to recognize that what the company in which they invest in does, is what their fund does, they are encouraged to think beyond mere profit. This shift enables them to direct their investments towards causes that address broader concerns, fostering responsible and sustainable corporate growth.

All corporate players must demonstrate responsibility towards the environment, society, and legal compliance, while prioritizing ethics, to dispel the stigma of being labeled as mere "money-making machines.". The corporate entities and the investors by shaping their investment decisions can evolve into forces driving positive change and contributing to a sustainable and equitable future. The paper opens with an introduction that traces the evolution of ESG, from the era of ethical and religious investing to the development of legislation mandating ESG considerations. The chapter on ‘ESG Securities’ delves into the intricacies of green securities and the emerging sustainability-linked securities, analyzing various regulations and circulars issued by the regulators. The final chapter explores how ESG investments influence corporate governance, encouraging companies to become environmentally conscious, socially responsible, and compliant with legal and ethical standards.