Tesi’s Impact Review is freshly out with a yearly snapshot into how our portfolio companies are faring on ESG matters. Although good overall, the 2023 results prove there is still more work to be done, and concrete actions should be taken. Continuous improvement requires relevant tools and understanding, and this is what we aim to bring with our ESG materials – to the whole ecosystem beyond just our own portfolio.
As summer has given way to autumn, Tesi’s annual Impact Review is out again. In addition to Tesi’s economic handprint, the review also provides an insight into the recent developments in ESG matters. We can now say that the development amongst the companies is ongoing, and most of the results are positive in comparison to the past, say, three years. Focus on GHG emissions continues, with almost half of the companies now conducting calculations. Many governance-related policies are also becoming more commonplace. In some cases, however, the year-on-year improvement curve is less impressive, or even flat. The practice of measuring other environmental indicators is lagging behind, and the gender splits amongst company boards, management teams and employees offer no surprises.
As investors, we want to provide our companies with the opportunities and tools to succeed, not just to cover the bare minimum, but to reach beyond compliance and towards ESG leadership. Thus, our approach needs to be wide: to support those taking the necessary steps to dealing with the basics, and to cater those wanting to go the extra mile. So, last year we started to publish resources touching a wide range of ESG-topics; something for both the new learners and the more seasoned experts. We also decided to make the materials publicly available to the benefit of the whole ecosystem.
First, for a comprehensive overview, we published a handbook covering 17 different ESG topics, sharing best practices and tips for beginners. For the aspiring leaders, we added a section on sustainability as a key component of the company strategy, and detailed guidance on conducting a double-materiality assessment.
Second, with a specific focus on climate, we put together an information package for carbon neutrality work. We also added a basic carbon footprint calculator for those small businesses without own production, who are looking to get acquainted with the work more practically.
Third, to support the fast employee growing of startups and growth companies, we combined over 50 policies and practices related to social or governance topics in a matrix. The tool shows which of these become mandatory as the company grows, and which we see beneficial for those looking to get ahead. The matrix will be updated yearly, most recently in late August 2024.
Lastly, we decided to publicly share our own reporting framework to increase transparency, as we wanted to showcase investor requirements in practice. Our reporting template will be increasingly adjusted to the EU-market standards, and a new version published when relevant.
Overall, we want your company to be prepared for what’s coming, whether the needs come from regulation, future investors, customers or employees. We hope that by utilising our tools and resources, companies can meet the current standards, yet also look towards more sustainable and responsible business practices. In the meantime, as responsible investors, we continue to follow-up on our own portfolio companies’ development regularly and encourage them to take the necessary steps – and perhaps a few extras.
Selja Ryöppy
Kehityspäällikkö, kestävyysasiat
Tesi
