The debate on CSR, RI, and ESG – the UNCTAD side


New York – The team at Integrity Research is currently engaged conducting deep dive research and analysis on the Environmental, Social, and Governance (ESG) space. Specifically, we are interested in uncovering details on the usage of ESG research by the buy-side, trends, and to decipher where this space is heading in the short- and mid-term.

As we thoroughly explore this space, we have uncovered interesting literature that is worth sharing with our readers. An excellent piece recently published in the Wall Street Journal making the case against Corporate Social Responsibility (CSR) was recently discussed in this space.

Toda we will analyze a piece that argues in an opposite direction from the WSJ article: the need not only for more involvement in CSR but for stronger practices in Responsible Investing (RI). This piece goes to the extent of calling for public policy action in order to guarantee the implementation of CSR and RI practices – a measure that the WSJ article sees as undesirable, at best.

The document in mention is a report recently published by the United Nations Conference on Trade and Development (UNCTAD) titled: Investment and Enterprise Responsibility Review: Analysis of investor and enterprise policies on corporate social responsibility. The 95-page report reviews the voluntary practices of the world’s largest transnational corporations and institutional investors regarding CSR and RI.

The first chapter of the report, titled “The Largest Transnational Corporations and Corporate Social Responsibility”, is based on information and ratings provided by EIRIS, one of the ESG research firms periodically tracked by Integrity Research. Referring to the data and analysis provided by EIRIS, the report establishes:

“While quantification of qualitative aspects of corporate policy and practice has inherent challenges and limitations, and the credibility and comparability of corporate reporting in these areas is still evolving, the EIRIS methodology is considered by stock exchanges, investors and fund managers to be an example of current best practice in this area.”

EIRIS’ methodology includes scoring each company in the categories of E-S-G further sub-divided into eight sub-topics: E = Environmental-General, climate change, biodiversity); S = human rights, supply chain labor practices, health & safety); and G = board practice, anti-bribery.

One of the main conclusions of the study establishes that public sector and governmental leadership is required to ensure that CSR reports and ESG analyses provide meaningful information on the impact of business on sustainable development. Furthermore, the report concludes that regulators should  work to strengthen the mechanisms through which institutional shareholders are able to influence the ESG practices of the companies in which they invest, while also encouraging investors to formally articulate their stance on ESG issues in public reports. The report establishes:

“Because of the ownership interests that global investors have in companies, responsible investing is seen as a key point of leverage in improving CSR practices amongst companies, and promoting a longer term, sustainable development view if investment.”

In short, the UNCTAD presents and interesting view on CSR- and ESG- related issues – an opposite view to the one we recently analyzed in this space. These different views motivate us to continue, and to sharpen, our exploration of the ESG research space. We will keep our readers updated as our results emerge.


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