ESG disclosures are increasingly used by investors to understand an organization’s key ESG factors and how
they impact overall performance over a longer time horizon. This is evidenced by four factors:
• The number of investors signing the United Nations’ Principles for Responsible Investment;
• The increasing number of shareholder proposals comprising environmental, social, or governance
resolutions;
• Surveys of investors that indicate an increasing number believe that ESG integration into the investment
process maximizes beneficiaries’ long-term interest, and that good governance and sustainability
practices contribute to the creation of long-term shareholder value; and
• Research that shows how investors incorporating ESG information and analysis in their investment
processes can outperform their peers.
Investors have an important role to play in promoting long-term sustainable organizational success.
However, a lack of attention to ESG factors, and the passivity and short termism of some investors, can
contribute to short-term thinking by companies.