Sustainable Finance is becoming the driving force for sustainable change
Sustainable Finance has become a powerful global movement led by both policy- makers and financial institutions.
The term itself is now both commonly used and broadly interpreted. It describes the process of Financial Institutions (FIs) taking account of Environmental, Social and Governance (ESG) considerations within their operations as well as when making financial or investment decisions (“Responsible Investment”).
However, the term Sustainable Finance is also increasingly used to describe the development of specialised ESG and sustainability-focused financial products that both encourage or fund environmental and social infrastructure or actions and meet the increasing appetite for ethical, sustainable investments. Sustainable finance is therefore also relevant for companies seeking to raise finance to support their ESG goals.
Global ESG assets are on track to exceed $53 trillion by 2025
Until recently, FIs saw ESG as primarily a risk management process. Regulation likewise primarily focused on ensuring disclosure, mostly on risks such as climate change exposures. Policy makers however saw that access to finance was essential to meeting their sustainability goals, especially on climate, and at the same time customers, from individuals paying into their pensions upwards have increasingly demanded their money be invested more sustainably.
Investors have adapted their strategies to capitalise on these market opportunities and directly invest in the companies that are more sustainable or provide sustainability solutions. Meanwhile, lenders have sort to provide innovative finance products to both individuals and businesses that either fund specific environmental projects and/or reward more general ESG improvement actions via preferential rates.
Increasingly regulation, lead by the EU, has sought to put definitions around what is “sustainable” to drive this market and ensure that capital is channelled to the genuinely impactful projects. Consequently, ESG assets are predicted to exceed $53 trillion by 2025 or circa a third of anticipated assets under management.
At the same time, businesses have been seeking this financing support. The most progressive firms are now partnering with lenders to put in place supply chain finance programmes to help their suppliers reduce their impacts.
Anthesis supports a broad range of sustainable finance clients
Anthesis works with all types of financial institution as well as with corporates seeking to raise capital, including:
- Banking institutions, including retail, commercial and investment banks
- Insurance companies, including general, life and non-life insurance
- Asset owners and managers, including public and private pension funds, sovereign wealth, family offices and private equity
- Brokerage, support and advisory firms
- Multinational financial institutions such as the International Finance Corporation (IFC) and European Bank for Reconstruction and Development (EBRD)
- Regional and national regulators and supervisory agencies
- Individual corporate borrowers entering sustainable financial transactions
- Corporates looking to implement supply chain or customer finance programmes
The Anthesis transaction services team understand the process, pace and language of transactions. The team has decades to experience of working with both acquirers and vendors across M&A and real estate transactions.
We assist financial institutions to develop new sustainable financial products for their customers depending on the type of customer and product. Anthesis also supports companies to prepare in advance of agreeing loans or the issuing of bonds.
Anthesis’ Sustainable Finance team understands these unique challenges and has delivered ESG strategy development and implementation support to a broad range of financial institutions across Banking, Insurance, Asset Owners & Managers.
Reviewing a Large Online Retailer’s Procurement Processes to Improve ESG Areas Within its Supply Chain
Anthesis was engaged to review an online retailer’s current procurement policies and processes for all categories of Goods Not for Resale (GNFR).
Consumer Goods Organisation ’Value at Risk’ ESG Assessment
Anthesis conducted a full value chain assessment of the principal Environmental Social Governance risks for a consumer goods organisation
Institutional Investor ESG Risks Screening
Using the Anthesis-designed RiskHorizon™ tool, we followed three simple steps to perform an ESG screening for an institutional investor looking to invest in a chemicals company,
Investing Responsibly: ESG Assessment Case Studies
In this installment of our “Investing Responsibly” series, Anthesis Group’s Phil Harrison discusses the role of ESG factors in three case studies.
Neste Corporation ESG Risk and Opportunity Assessment
Neste Corporation was looking to adopt a pragmatic approach to environmental, social and governance (ESG) risk and opportunity management appropriate to the geographic scale of the organization, its business activities, and overall strategic objectives.
Financial Services Organisation Modern Slavery Act Compliance
Anthesis carried out a four-stage approach to support a global financial services organisation compliance to the UK Modern Slavery Act
Mapping financial requirements to facilitate the transition away from virgin fossil-based plastics
Learn how Anthesis supported The Swedish Environmental Protection Agency on the transition from virgin fossil-based plastics to sustainable materials.
Portfolio of Investments Environmental and Social Review
Our client, the owner of a public-private partnership investment Fund, was aiming to promote energy efficiency and renewable energies in South East Europe and neighbouring European regions outside the EU.
Transactional Commercial Due Diligence Support for Waste-to-Energy Portfolio Investment
Anthesis provided commercial due diligence support to a global investment organisation, to evaluate markets for the waste operator’s EfW plant portfolio.
Advanced Plastics Recycling Technologies and Market Screening for a Large International Bank
With an increasing demand for plastics recycling and recycled polymers, advanced recycling technologies are rapidly developing. Find out more about our work with a leading international bank.
Over the last 18 months, Anthesis’ expert but human approach has seen our partnership grow across a multitude of areas of ESG. An absolute pleasure to work with, Anthesis have seamlessly integrated into our ways of working. Immediately grasping where we were in our ESG maturity, they have shown a genuine desire to help us move things forward through applying expertise and passion from across a vast array of subjects and sectors.
Head of ESG, AO
We wanted the ESG screen as we were keen to understand the definition of ESG and to see the criteria you would be using. We were also interested to see how others would view us through this lens. The Anthesis screen provided us a with a “mirror”. The value to Neste was that it confirmed we are on a right track to addressing ESG issues. It also helped us to identify some potential improvement opportunities, several of which we are working on, and others that warrant further evaluation.
I have worked with Anthesis for many years. They have a depth of ESG understanding and expertise, allowing real analysis and advice on the emerging issues that are becoming increasingly material to our clients. What sets them apart is their willingness and ability to apply this, together with technology solutions, to enhance the quality and speed of their reporting.
Partner, Latham & Watkins
Bioplastics are a promising solution to the global plastics problem. Anthesis was collaborative and creative in their analysis, which helped deepen our understanding of this exciting opportunity.
It was a joy working with Anthesis. They provided a wealth of experience in enabling us to understand the nuances of the metrics so that we could put our best foot forward in our sustainability report. In short, I give Anthesis my highest recommendation as a Corporate Responsibility partner and publisher, and I would not hesitate to work with them again.
VP Investor Relations
A Guide to the EU Sustainable Finance Disclosure Regulation for Financial Institutions
The Sustainable Finance Disclosure Regulation (SFDR), also known as Disclosure Regulations, came into force on 10th March 2021, imposing new transparency and sustainability-related disclosure requirements to the financial services sector. Find out more about the regulation.