A structured business approach to ESG disclosure assists Cordiant in managing social, environmental and ethical risks and is increasingly seen as a priority and precondition to sustainable development efforts. Cordiant believes that proper respect for ESG principles can optimize investment strategies, risk management, responsiveness in volatile markets, reduce costs for all parties engaged in investment activities, as well as strengthen stakeholder relations and improve a borrower’s brand, reputation, and profitability.
Each potential investment is subjected to a multi-stage approval process with analysis of the ESG risks incorporated at the outset of the process. Cordiant assesses potential investments on a variety of levels, beginning with the sector (i.e. does it fit into Cordiant’s preferred areas of focus?). The first step of screening is therefore rejecting undesirable investment categories and ensuring that all proposed investments do not show evidence of excluded/prohibited activities.
By investing in sectors with already high potential for positive social, economic, and environmental impact, in addition to financial return considerations, Cordiant seeks companies that support our Impact Investor themes that include bridging the digital divide, food security and the modernisation of agriculture, enhancing energy security whilst reducing greenhouse gas emissions, improving transportation whilst reducing pollution and sustainable urbanisation. Hence, Cordiant seeks to invest in well‐managed and commercially-minded enterprises that generate positive development outcomes (see below).
Seeking Inherently Impactful Sectors
- Sustainable production practices and modernization of agriculture
- Clean Energy
- Sustainable Transportation
- Information and Communication Technologies: Digital Communications
- Other sectors, as appropriate
Cordiant’s ESG analyst then identifies an investment’s potential impact:
Seeking Best Practices & Impact Themes: Environment, Health and Quality of Life
- Improving food security
- Increasing agricultural exports
- Generating renewable energy
- Increasing energy efficiency (and storage)
- Bridging the digital divide