When portfolio managers make decisions that affect our CPP or RRSPs, we want them to pay close attention to the hard financial data. Things like a company’s earnings, profits and debt levels. But now, many are adding “ESG” to the mix of factors they weigh when deciding which companies to invest in.
ESG measures involve three components: environmental, social, and governance. And ESG disclosure has fast become an important standard that investors use when deciding where to invest. Its effect on the energy and pipeline industries is increasing daily.
That’s why we’re introducing a three-part blog series to examine what’s behind E-S-G. This week, we explore the ‘E’ in ESG.
The environmental component of ESG is where investors look for data to help them understand whether a company faces risks related to environmental impacts. In this category, investors weigh companies’ reporting on carbon emissions, air and water pollution, biodiversity, energy efficiency, waste management, and water management, among other things.
Canada is a global ESG leader. And CEPA members’ commitment to safely delivering the responsible energy we all need is a big reason for this. To learn more, visit the 2020 transmission pipeline industry performance report.
In next week’s About Pipelines blog, we’ll look at the social component, or the ‘S’ in ESG.
If you want to learn more, check out some of our other recent blog posts: