Techniques for Organizational Investment and Sustainability

ESG investment

There are several investing techniques available for the growth and good future for any organization. One of the investing techniques can be seen is ESG that is environmental, corporate and governance technique. The corporate social responsibility can also be seen for the investing technique available. This ESG technique is introduced here to understand whether it is better than CSR technique or not. This was introduced for increasing the performance in the organization but it can be seen that it has more cons than its pros. For a better investment plan and future of any organization, the CSR and ESG t3chnique is being analysed in this paper and is required to be understood properly. Business dissertation help is critical in navigating through the complexities of all these techniques. This ESG technique is being discussed in this paper in order to understand whether it can have a positive impact on the environment and the organization as well or not. But it is to be understood that CSR is an old technique and cannot be replaced by others.

CSR VS ESG

Thinking of organizations is changing due to the application of these CSR or ESG techniques. The ESG issues are generally required to be looked properly for the proper selection between the ESG and the CSR implementation. The annual basis is being seen to be achieved by the help of these CSR values. The ESG is required by organizations but its impact is present is higher than its investments (Amel-Zadeh, 2018). Among the two investment techniques, the CSR is much suitable than ESG. CSR is much promising that he ESG technique and promises for the security and the safeguard of the policies that are available. This CSR is a beneficial one for the stakeholders available. The CSR is a valuable methodology for the investment and the returns. The ESG is not a method that can be comparable to the CSR methodology and can be useful for the long investment only (Investopedia, 2019).

Impact of ESG investment

In this ESG investment technique, it is required to be understood that the same returns are not gained by the investors easily.

The ESG has a lot of cons that are being described below:

The ESG strategies are generally hard to understand and the investment is not a proper one for it. The criteria for this investment are required to be understood properly for the strategy of this ESG investment (Hisano, 2018). The core values are not a beneficial one in terms of gaining any funds in future. The issue is generally a trickiest one and the problems cannot be understood properly in this ESG investment many times. This investment is not a prominent one for the individual investor for their business.

Ethics: The financial side is required to be corrected here for the investment. Thinking on the highest returns without focusing on the investment is a scenario that can be seen here easily. Business ethics is mainly degraded by the application of this ESG methodology in many organizations (Avetisyan, 2017). The 3 to 10 years investment based on the ESG technique can be seen here to be an underperformed one for any organization. Competitive advantage is not achieved in this part and the competence is generally complex in nature in this investment technique.

High investment needed: A high investment is generally needed in this investment technique. This investment technique is generally beneficial for the short term and high investments. Wold largest social organization is not found to be investing high on these investment techniques. This investment technique doesn't promise with the preservation and safeguards to the environment and the corporate values (Björkman, 2019). Thus it requires a good visual for the investment. The financial return is having adverse effects on this part. The capital cost is higher in the investment technique available here.

The proper documentation can be the biggest problem here for the products to be implemented in the market. It is a doubt whether this investment plan will give a beneficial result in future or not. A long term positive impact is not possible with this investment technique that can be seen in the CSR method available. Social and environmental impact can be seen available in organizations adopting this methodology.

It’s not socially responsible: Many times it can be seen that the market value of this investment technique is degraded. It can also be understood that the business responsibility is not achieved properly by the application of this investment technique in the companies (Buallay, A., 2019). A socially and responsible investor is generally required for this kind of investments.

This investment technique generally creates controversy within and outside the organisation. It gives very fewer options for the investor and thus the CSR value can be seen to be more ethical one than the ESG one here (mitsloan.mit, 2018).

Proper sustainability and social change cannot be determined through this technique here. The laws and regulations are seen to be shifting aside in this method. A less profit is generally achieved through this investing methodology here. Company’s security is seen to be in risk by this investment technique here (panagora.com, 2019).

Conclusion

Thus it can be understood from the paper that the ESG investment method is not the best method that can be adopted by the organizations. The CSR method is more efficient as compared to that of ESG method here. This method doesn't provide a successful safeguard and security to the environment and the social values that are present in an organization. The shareholder's wealth is not seen to be incremented in this investing technique. This ESG technique is seen to be beneficial to some extent but its impacts on the returns are generally high than the investment that are imposed by the organization. It can be said that this ESG technique is composed of risk and milestones for its implementations in any plan. Thus awareness related to ESG investment plans are still required to be enhanced for its better understanding. This sustainable investing plan and is needed to be looked properly for better returns in future.

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Reference List

Journals

Amel-Zadeh, A. and Serafeim, G., 2018. Why and how investors use ESG information: Evidence from a global survey. Financial Analysts Journal, 74(3), pp.87-103.

Hisano, R., Sornette, D. and Mizuno, T., 2018. Prediction of ESG Compliance using a Heterogeneous Information Network. arXiv preprint arXiv:1811.12166.

Avetisyan, E. and Hockerts, K., 2017. The consolidation of the ESG rating industry as an enactment of institutional retrogression. Business Strategy and the Environment, 26(3), pp.316-330.

Björkman, H. and Erlandsson, M., 2019. The Effect of ESG on a Global Fund Market-Integrating Environmental, Social and Governance (ESG) in the investment strategy: A Global Market Research.

Buallay, A., 2019. Is sustainability reporting (ESG) associated with performance? Evidence from the European banking sector. Management of Environmental Quality: An International Journal.

Online Article

mitsloan.mit, 2018, Evaluating the Relationship Between ESG and Corporate Fixed Income Available at: