Investors

The first three stories in our investor section are indicative of a new but distinct trend. Big banks are getting seriously interested in social and environmental issues. This is not because they want to move out of banking and into philanthropy. It is because, as the Chief Operating Officer of Westpac says, "Considering that a large share of company value is intangible and relates to future earnings, it is evident that risks and opportunities deriving from environmental and social trends are of great importance." It's the money, stupid! In the electric utilities sector, the level of financial risk exposure from regulatory responses to climate change can vary by a factor of 30. No wonder the banks want to find out which companies have high risks and which low risks. Banks are even starting to produce guides to assist in the assessment as in the excellent Goldman Sachs Energy Environmental and Social Index (GSEES Index).

Heightened interest by mainstream investors will have an increasingly big impact on companies and their CSR agendas. (It is interesting to see how much emphasis the GSEES Index puts on workforce matters for example, not currently considered to be a major CSR issue for oil and gas). Growing mainstream investor interest could begin to crowd out NGO influence in setting the CSR agenda. It is likely to make CSR more systematic, more measurement driven and more cost/benefit conscious.The next milestone? UNEP's publication of globally recognised principles for responsible investment in September 2005. Mark it in your diaries.