KRISHNA UTTAMCHANDANI | Associate, Capco

As ESG assessments begin to evolve towards an industry standard, financial institutions and their investment approaches find themselves under the microscope of the public and regulators. As a result, a common debate has arisen between the “right” approach of divestiture versus those of engagement. Though there are proponents for both sides, this paper seeks to outline the benefits of, and propose solutions for, engagement, allowing financial institutions to steward the progression to a healthier ESG outlook. Given the surge in ESG stewardship and active ownership, it seems likely that governing regulatory bodies will begin to mandate, and perhaps regulate, active ownership policies; taking action in advance of these mandates will better position financial services for a socially and environmentally equitable future.