tbli conference nordic 2016 workshop c1 - transparency ola löhman
TRANSCRIPT
OLA LÖHMANdirector ESG
CSR – as investment
F C F F
W A C C D C F
Anything that affect the equation is financially material
> 50 % of global capital owned by ”the masses of people”
5 connections5 connections 3 connections4 connections2 connections3 connections
Companies1. Perceived lack of adequate senior executive expertise in non-financial
performance issues 2. Reticence to include in investor presentations unless material to
current business strategy.3. Concerns over the robustness of non-financial performance
management information and internal methodologies for delivering it.4. Lack of senior executive confidence in the company‘s ability to
manage non-financial performance to the extent of being able to maintain current and forecast future performance.
5. Skepticism at investors‘ interest in non-financial performance.6. Concerns about impact on personal credibility of senior executives
promoting messages that are not perceived by investors as core to the financial performance of the business.
The blockages
Investors• Inadequate evidence of casual link between non-financial and financial
performance.• Lack of robust inter-company or sectoral frameworks for comparison
of non-financial performance.• The relative importance of non-financial performance differs between
risk and regulatory environments.• Investor expertise limited to assessment of non-financial performance
related directly to the business strategy or leadership competence.• Lack of willingness to publicise basis of evaluating non-financial
performance to protect proprietary analytical tools and approaches as a source of market differentiation, creating lack of transparency in investor methodologies.
10
The blockages
1. Most companies do measure a wide range of KPIs, but they are less linked to business performance management.
2. Often, companies let international reporting standards drive their measurement, as opposed to measuring what is most material to their business.
Main findingsfrom companies & senior management
The directive1. The business model
– How a company produce money
2. Policy – How a company can be expected to behave socially
3. Risk – The chance that an investments actual return will be different than expected
4. Comply or explain
F C F F
W A C C D C F
Anything that affect the equation is financially material
F C F F
W A C C D C F
Eenvironmental
S social
G governance
Exposure
Abilities
Discounted future
END
Ola LöhmanDirector ESG CSR Sweden