FTI’s Integrated Approach to ESG and Sustainability/media/Files/us... · Historical Evolution of...
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FTI’s Integrated Approach to ESG and Sustainability Performance assessment, planning and execution for best-in-class investor and stakeholder engagement and communications in order to manage risk, create opportunity and drive growth with prosperity
Transcript of FTI’s Integrated Approach to ESG and Sustainability/media/Files/us... · Historical Evolution of...
FTI’s Integrated Approach to ESG and Sustainability
Performance assessment, planning and execution for best-in-class investor and stakeholder engagement and communications in order to manage risk, create opportunity and drive growth with prosperity
Our Point of View on ESG and Sustainability
Mainstream Policy and Corporate Agendas
Whether it is due to the global health
pandemic, the climate and wider ecosystem
emergency or wide-spread social inequality in
society, the global case for a model of human
development that is genuinely sustainable has
come of age.
For companies and investors, the sustainability
transition presents both risk and opportunity.
They are increasingly expected to play active
roles that ensure sustainability goals are met
whilst also seeking profit. In doing so, the
Environmental, Social and Governance (ESG)
agenda of investors has become important for
company Boards and their business strategies -
as a resilience as well as a sustainability test.
“Within the next 5 years all investors will measure a company's impact on society, government, and the environment to determine its worth”
--Larry Fink, BlackRock CEO
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“The SDG are a moral imperative. The SDGs are also an economic imperative. Their achievement would mean greater productivity, increased labour supply and ultimately
stronger growth. In short, they could pull the global economy out of its current malaise of secular stagnation.”
-Mark Carney, Governor of the Bank of England
The Transition of ESG to a Corporate Sustainability Agenda
nvironment ocial overnance
Regulatorycosts
Compliance
Stakeholders relations
Low priority
Investor reassurance
Business as usual
ocial purpose, responsibility, engagement
Fiduciary overnance, financial resilience, business
innovation
nvironmentallimits, resources
and impacts
Corporate strategy and performance
From defensive, marginal and low impact
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To strategic, high priority and transformative
Historical Evolution of ESG Landscape
2000s 2010s 2020s
Economic argument for ESG
• Focus on transparency, disclosure, and oversight
• Emergence of reporting standards and KPIs
• Regulatory mandates and policy initiatives
• Shareholder support for proposals reaches record numbers
• More companies adopt policies and provide disclosures
Values-oriented argument
• Calls to action: adopting specific policies or divesting operations
• Perception as fringe issues with weak economic argument and socially and politically motivated
• Limited consideration by companies. Focused on regulatory compliance.
• Shareholder support in single digits
ESG as a requirement
• Focus on business-relevant, material issues
• Focus on measurable performance
• Standardized and widely-adopted ESG disclosures
• Asset managers take a proactive approach across entire portfolios
• ESG as a driver for companies to access to capital, talent, and business opportunities
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The Increasing Demand for ESG Accountability
In the face of global disruption caused by climate change, natural resource scarcity, social volatility, fast-changing technology and geo-political uncertainty, Environmental, Social and Governance (ESG) factors and the actions organizations are taking to address these issues have never been more important.
The demand for companies to operate with greater transparency and social purpose has increased scrutiny from and increased opportunity with a host of stakeholders including customers, investors, employees, media and policymakers around environmental, social and governance issues.
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Climate Change
Carbon emissions
Sustainability Initiatives
Supply Chain Transparency
Pollution & Waste
Natural Resource Consumption
Regulatory Compliance
Energy Efficiency
Executive Compensation
Proxy AccessBoard Independence
Shareholder Rights
Corporate Culture & Ethics
Lobbying & Political Contributions
Board Diversity
Diversity & Equal Opportunity
Workforce Safety
Community Engagement
Human Rights Protection
Employee Training
Privacy/Data Security
Product Safety
Corporate Philanthropy
Executive Advocacy
Labor & Union Relations
Product Societal Impact
Customers
Regulators
Employees
Media
Investors
Policy Makers
Our Integrated Approach
We Are Uniquely Placed to Advise Clients on ESG and Sustainability
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The FTI offer reflects our expertise across Public Affairs, Investor Relations, Shareholder Activism and Corporate Communications.
We see how public policy on ESG and sustainability shapes business strategy; and know how to align corporate ‘walk’ with comms ‘talk.‘
Importantly, we understand the foundation for our work relies on the belief that companies should focus on developing a strategic framework that integrates ESG with company strategy for the long-term benefit of shareholders and stakeholders. Improved ESG ratings matter, but those are an outcome of our work, not the focus.
This comprehensive understanding of the factors shaping ESG give FTI an unrivalled ability to anticipate and deliver against clients’ needs.
SustainabilityAssessment
and Planning
Business Performance and Direction
Regulatory Compliance
Communicating Purpose
Policy Ambition
Corporate Affairs and Employee
Engagement
Investor Reporting and Disclosure
Public Affairs and Stakeholder Engagement
Supply Chain Relations
ESG Program Development Stages
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Program and Landscape Assessment
Strategy Design and Positioning Platform Development
Messaging Amplification and Stakeholder Engagement
Evaluate strengths and weaknesses in an ESG program compared to best practices, peers, and shareholder expectations
(Re)construct programs, initiatives, and internal processes to rebuild credibility and reputation in the eyes of key stakeholders
Enhance, strengthen, and (re)position ESG messaging to improve stakeholder understanding and receptivity through engagement
Regardless of a company’s unique business challenges or existing progress on ESG and sustainability program development, FTI’s ESG and sustainability offering takes a research-based approach to help a company develop an informed strategy that leverages effective messaging and multi-stakeholder engagement to elevate its ESG profile with investors and meet the sustainability expectations of its stakeholders.
Monitoring and MeasurementMeasure progress against stated goals and metrics to ensure continued enhancement of ESG program
Research-driven Program and Landscape Assessment
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By reviewing our client’s performance relative to peers and best practices, FTI will identify key performance indicators that will help create a roadmap for improving our client’s position relative to peers and the market in areas of primary interest.
• Analyze key areas of ESG factors that are most material to the company’s industry, geography and operations.
• Assess company practices and disclosures relative to peers, best practices, and shareholder expectations
• Analyze key areas of environmental, social, and governance factors that are most material to the company’s industry, geography, and operations
• Use holistic approach when analyzing performance relative to best practices based on multiple reference points, stakeholder and policy expectations:
• Reporting frameworks intended for various audiences (SASB, GRI, TCFD, CDP, and other industry-specific or regional frameworks)
• ESG rating agencies and other influencers
• Regulations and codes of best practices, evolving policy and expectations
• Identify key priorities for improvement based on material impact
• Develop recommendations for strategy development based on following parameters:
• Management approach: strategy and prioritization relative to materiality
• Initiatives: programs, policies, and procedures to address risks and opportunities
• Metrics and targets: performance based on quantitative factors and progress relative to stated objectives or industry benchmarks
ESG Assessment
Program Development
Management Incentives
Board Quality
Workforce & Human Capital
Health and Safety
Shareholder Rights
Climate Change
Resource Management
Communities & Society
Environmental Impacts
Leader Early Adopter
Late Adopter
Laggard
CompanyPosition
FTI ESG Compass
Strategy Design and Platform Development
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Review ESG Reporting Framework(s)Develop Disclosures, Goals/KPIs and Reputational Drivers
• Review focus and requirements, of SASB, GRI, TCFD, UNSDGs, and other frameworks and prioritize adoption
• Determine preference for reporting depth and establish commitments
• Identify data required for collection
• Develop KPIs based on stakeholder feedback, materiality analysis, reporting frameworks, and data availability
• Establish long-term goals tied to KPIs
• Identify near-term and longer-term reputational drivers tied to ESG issues to protect and promote license to operate
Strategy Design and Platform Development
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Develop Unified ESG Positioning Platform
• Develop ESG and sustainability narrative and message framework that links ESG and sustainability objectives & long-term goals to broader business strategy and to serve as foundation for forward-looking communications
• Develop messaging targeted to all stakeholders, including employees, customers, suppliers, investors, media, and regulatory bodies
• Develop a sustainability report to disclose sustainability programs, policies, and initiatives, and provide progress updates against stated goals and initiatives
• Develop a designated website to position as central hub for all key disclosures
• Develop creative collateral and stakeholder-specific materials
Integrate ESG Objectives into Stakeholder Materials
• Develop tactical communications plan to educate and generate awareness for ESG and sustainability platform and goals
• Create platform to engage with employees to generate buy-in and support for ESG and sustainability strategy
• Establish strategic external partnerships and program-based solutions that align priorities with societal needs to activate strategy with all stakeholders
Establish Multi-Channel Engagement and Amplification Strategy
Messaging Amplification and Stakeholder Engagement
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• Alter approach to existing investor engagement to incrementally target ESG-centric investors and passive shareholders in the ‘off-season’
• Ensure investment community understands how ESG fits into the larger equity story
• Proactively create a dialogue around recent initiatives, goals, and assessment of risks and opportunities
Engage with Investors Engage with ESG Rating Agencies and Proxy Advisors
Enable Index Inclusion
• Optimize information availability and provide clarity to ratings analysts
• Provide timely feedback to rating agencies and maintain awareness of changes to scoring methodologies
• Liaise with proxy advisors to help ensure favorable representation in the case of an adverse shareholder proposal
• Identify most attractive sustainability indices
• Determine gating factors for inclusion and opportunity timeline
• Selectively target components of specific ESG ratings to gain entry into ‘leaders’ indices
• Activate ESG and sustainability strategy and develop a cadence of communications to key stakeholders following ESG and sustainability program development or completion of the first key milestone to maximize visibility and elevate industry leadership
• Issue sustainability report
• Engage employees around the ESG and sustainability strategy
• Proactively create a dialogue around recent initiatives, goals, and assessment of risks and opportunities
Ongoing Execution and Measurement
• Track and refresh long-term goals
• Refresh key messages, annual sustainability report content and cascade messaging into stakeholder materials
• Enable regular engagement with employees
• Elevate ESG platform through executive positioning opportunities to promote thought leadership that delivers a unique and differentiated point of view
Messaging Amplification and Stakeholder Engagement
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Targeted, Sustained Multi-stakeholder Engagement
Our Credentials
Our Unique Capabilities and Experience
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Extensive and Leading Capabilities in Sustainability and ESG
With Experience Operating Across All Industries
In Every Corner of the World
We offer what no other firm can – a holistic point of view on how companies can manage the risk and exploit the opportunity of ESG from a regulatory, financial, political and marketplace perspective.
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Cities
27
Countries
100
Offices
Aerospace & Def.
Agriculture
Automotive
Construction
Environmental
Energy and Natural Resources
Financial Services
Healthcare and Life Sciences
Hospitality, Gaming & Leisure
Insurance
Industrials
Mining
Public Sector
Real Estate
Retail and Consumer Products
Tech and Telecom
Transportation
Financial and Sustainability Reporting
Rating Agency & Index Engagement
Public Affairs Advocacy
Environmental Policy
Crisis & Issues Management
Employee Engagement
ESG governance
Shareholder engagement
Activism defense
Stakeholder & Community Engagement
CSR/Philanthropy
Research & Measurement Former journalists and media professionals
Former proxy advisors, policy makers and
public officials
Former industry operators
Former sell-side and buyside analysts, investment
bankers, and investor relations professionals
Design specialists
Supported By a Team With Unmatched Relevant Experience
Select ESG and Sustainability Experts
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Americas
Bryan Armstrong, [email protected]
EMEA
Helen [email protected]
Rodolfo Araujo, CFAWashington [email protected]
Ana HeerenWashington [email protected]
Jonathan [email protected]
Asia Pac
Christine [email protected]
Kerstin [email protected]
Martin [email protected]
Peter [email protected]
Caroline [email protected]
Juan [email protected]
Caroline [email protected]
Shane [email protected]
Adriana [email protected]
Shannon [email protected]
Nick [email protected]
Arnaud de [email protected]
For general enquiries please contact: [email protected]
Marcus [email protected]
Our global team brings decades of experience in capital markets, research and reporting, governance and activism, corporate reputation and climate change, among others. We work across geographies to bring our clients the specialized support they need.
FTI Consulting: Experts with Impact
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Definitive Expertise
Industry Experience
Construction & Environmental
Energy Power & Products
Financial Institutions
Healthcare & Life Sciences
Insurance
Mining & Mining Services
Real Estate
Retail & Consumer Products
Telecom, Media & Technology
1. Number of total share outstanding as of February 17, 2020, times the closing share price of February 25, 2020
A Culture That Delivers
Practical in our communication and approach to outcomes
Judiciousin complex, multi-party situations
Collaborativewith clients and colleagues
Professionalin our commitment to work with the highest caliber
5,550+
Employees
550+
SMDs
$4.1B
Market Cap.1
82
CitiesAdvisor to
8/10of world’s bank holding companies.
Advisor to
95/100of world’s best law firms.
Clients are
53/100of Fortune Global corporations
27
Countries
Operational
Political & Regulatory
Comprehensive Services
1982
Year Founded
Financial
Legal
Reputational
Transactional
Business leaders from around the world come to FTI Strategic Communications with their most complex, business-critical issues that require diverse skill sets and integrated disciplines.
As part of a global business advisory firm, we help these organizations manage change, mitigate risk and enhance their market position by combining decades of deep subject matter expertise with functional and disciplinary experience.
