08 Jul 2018

A development economist has advised African businesses and investors to be more environmentally conscious in their approach to business so that they could have good long-term rewards.

Presenting on the topic ‘Integrating Environmental, Social and Governance (ESG): Progress and Gaps’ at Kgori Capital Press Club on July 5, head of Africa and Middle East, United Nations-supported Principles for Responsible Investment (UNPRI), with a primary focus on the provision of strategic advisory services in development space, Ms Nicole Martens said it was imperative that businesses incorporate environmentally sustainable concepts in their investments portfolios and operations.

Ms Martens, who is based in South Africa, is currently working on developing new relationships with stakeholders in the investment space and starting design of an Africa-focused strategy for identifying and addressing the needs of African investors with respect to integrating ESG into investment processes.

She noted that aligning to the concept of Responsible Investment in conjunction with ESG was an advisable initiative as it had the potential to minimise risks and generate sustainable long-term returns, especially if there was incorporation of active ownership of the project or business entity.

According to the business expert, responsible investment is an approach to investing that aims to incorporate ESG factors into investment decisions, to better manage risk and generate sustainable, long-term returns.

In the same breath, Ms Martens noted that ‘responsible investment does not require ruling out investment in any sector or company; but it simply involves ESG information in investment decision-making, to ensure that all relevant factors are accounted for when assessing risk and return.

In addition, she said, “Responsible investment does not require the use of specialised products, but is primarily about bringing additional data and analysis into existing approaches.”

She said tailored products such as environmentally or socially-themed funds, green bonds or social impacts bonds could form part of a responsible investment strategy. In his welcome remarks, Kgori Capital managing director, Mr Alphonse Ndzinge noted that the club started four years ago and prides itself with engaging members of the media to share pertinent issues such as the one on the floor.

Mr Ndzinge also said Ms Martens was in the country to appreciate the business atmosphere and opportunities and further see how investment could be enhanced in the country and the rest of Africa in general. ENDS