Summary of SAM's Webcast on Sustainable Finance

New criterion for banks, insurance and financial services companies
Summary of SAM's Webcast on Sustainable Finance
Publ. date 14 Nov 2019
On the 12th of November, SAM conducted its fourth webinar on the Dow Jones Sustainability Index (DJSI) 2019 results. This webcast zoomed in on the criterion of Sustainable Finance which was introduced to the 2019 assessment for the banking, diversified financial services, and insurance industries. The criterion replaced the former criteria Business Risks & Opportunities and Controversial Issues, Dilemmas in Lending & Financing. Download our free summary of the highlights in the attachment of the article.

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This webcast provided more background on the methodology updates and findings on the topic of Sustainable Finance. This criterion was newly introduced with a weight of 9%, following SAM’s conclusion that this topic is highly material for the finance sector. The overall results show that European companies stand out in comparison to North American or Latin American peers, because European firms tend to have a more comprehensive approach towards ESG integration. This can also be explained by the fact that there is increased pressure from local authorities on integrating ESG criteria in financial portfolios.

Sustainable Finance: A Plan-Do-Check-Act Approach

The purpose of this newly introduced criterion is to assess how financial institutions integrate ESG criteria in its business segments, and which ESG products and services are offered through a company’s business operations. When assessing a company, the principle of Plan-Do-Check-Act is applicable. The first step asks whether a company has an ESG policy in place. Next to this, it is assessed how broadly applicable this policy is and what kind of ESG products and services are offered by the company. The next step is to quantify these ESG offerings as a part of the company’s total revenues, and finally to be transparent about these aspects to the wider stakeholder base through public disclosures.

Overall, SAM finds that companies who perform well in this area find themselves well-positioned to leverage the opportunities resulting from a growing demand for sustainable finance, and to mitigate the risks of non-compliance to upcoming regulations.

Please find the highlighted developments and performance norms in more detail in the downloadable summary on top of the page.

Want to learn more about leading the DJSI?

With more than 15 years of experience in Dow Jones Sustainability Index support and a long-term collaboration with SAM, Finch & Beak is Europe’s leading expert in helping companies to get more value out of their participation in ESG benchmarks. Contact Josée van der Hoek, Director, at josee@finchandbeak.com or call her at +31 6 28 02 18 80 to learn how we could help your company accelerate your ESG results.

About Bas Nuijten

Sustainability professional aiming to help organizations to continuously improve their sustainability strategies. | 
bas@finchandbeak.com

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