Environmental issues are on the board’s agenda in Asia

Does your board have clearly defined oversight over the impact of the company on the environment?

ENVIRONMENTAL issues are coming into sharper focus in boardrooms as regulators and stakeholders demand greater adherence to environmental, social and governance (ESG) standards.

In Asia, a greater number of companies are actively reducing greenhouse gas (GHG) emissions and the ways at which they do so are discussed in boardrooms. Four in five Asian-listed companies (84%) say their board of directors have a clearly defined oversight over the impact of the company on the environment. This is up from 79% in 2015, Asset Benchmark Research (ABR) finds in the latest survey involving participants of the The Asset Corporate Awards, Asia's premier and longest-running awards on ESG.

The most recent sustainability survey of corporates by Asset Benchmark Research (ABR) shows Asian corporates scored highest on environmental responsibility at 76.8 in 2017, a 20% jump from 61.6 two years ago. While around two in three Asian-listed companies pursued business strategies to reduce GHG emissions in 2015, this increased to 84% in 2017, ABR data show. The majority of companies also calculate and register GHG emissions, savings and offsets

Increasingly corporate boards are making the connection between environmental issues and a company's business mission. Climate risks to businesses are on the agenda, according to ABR. Improving related disclosures as well as finding ways to communicate environmental efforts to investors and stakeholders are also discussed.

Ross Teverson, head of strategy, emerging markets, Jupiter Asset Management, which has US$71.5 billion in assets under management, believes that companies are pursuing discussion about environmental issues because stakeholders and regulators care about these issues.

There is increasing awareness on environmental issues because "there is a great push from clients to make sure that they can report to their end-customers that they take these things into account", says Teverson at the recent The Asset Leadership Dialogue in London.

Studies have shown a link between the inclusion of ESG concerns into corporate strategy and improved long-term corporate performance. This is driving board directors to integrate environmental issues into financial and operational performance. This also signals to investors how well the company is run and its longterm financial sustainability.

To learn more about The Asset Corporate Awards, please click here.

To learn more about Asset Benchmark Research, please click here.

About the research

The research was conducted as part of The Asset Corporate Awards 2017, the longest-running ESG awards in Asia, bestowed annually by leading research house, Asset Benchmark Research (ABR). The Platinum, Gold and Titanium awards offer a rigorous benchmarking service for the region's listed firms and enables them to join an exclusive circle of top corporates. Since 2001, our winners have found this opportunity to be valuable in bolstering their credentials in the ESG space.

The assessment is based on the online questionnaire submission made by the company and the supplementary information they provide. Factors that are taken into consideration range from an evaluation of financial performance, management, corporate governance, social and environmental responsibility and investor relations.

Date

28 May 2018

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