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ESG clarity all benefit for developing companies

8 April 2022
Jack Baker

As Environmental, Social and Governance policies converge, a single set of standards should lower confusion and be an all-around boon to the economy — and developing companies might be the big winners.

Parvate Collective managing director Jim Allenby says the coming together of ESG standards is a timely relief that should help smaller companies benefit from more precise guidelines.

His company — working with large and smaller companies to design their ESG journey — noticed clients had been in a holding pattern before the announcement — ‘a word salad of acronyms’ floating in the ether.

“Big companies have the means to throw resources at the issue and report against every standard while developing companies stand overwhelmed,” Allen reports.

“Many are holding out for this global standard and the opportunity to do something — everyone likes clarity.

“It will help Australia, financial institutions, investors and companies bring everyone into line and cut out the guesswork, make it possible to do better and what it means to do that.”

And it all starts at the top.

Allenby draws comparisons between his former life as an Australian and UK-based professional cricketer with the ESG journey he takes with clients.

Having notched up 7784 first-class runs, he attests a surprising symbiotic relationship between leather and willow and the oaken tables and plush chairs of the corporate boardroom.

“In sport, you set goals, targets, and a process to achieve,” Allenby says.

“Professional sport and ESG require similar skill, and it is fascinating to see.

“What you see on the field is the product of a considerable amount of work planning with different stakeholders to get 11 people performing —ESG starts with leadership wanting to understand.

“If you get strategy and decision making at the top right, you will get the results on the field and in the company performance.”

ESG clarity is now on offer for companies and investors alike. Allenby says investors are now keenly aware of ethical reporting and making wise choices.

Allenby also adds that the industry is expecting ‘exponential growth’ as compliance moves from a box-ticking exercise to qualitative change,” he says.

“Tightening up procedures and data collection to a streamlined process does not take resources away from the core business. There are no secrets anymore,”

“It is in straightforward terms now, whereas there was art and skill involved in collecting data nine months ago.”

“Get a long-term goal for constant improvement — set a benchmark, where you want to get to with achievable targets along the way.”

Mt Monger Resources

Mt Monger Resources is bringing ESG to the forefront of its operations.

The recently-listed explorer has pivoted towards battery metals in the south of Western Australia while remaining focused on its gold-focused projects near Kalgoorlie and Laverton.

“What I found with Mt Monger was an appetite not just for themselves but awareness and education generally of ESG for their professional development,” Allenby says.

“That is a great start, intent and attitude of leadership and the board.”

Balkan Mining and Minerals

The Serbian lithium explorer is committed to activating ESG but faces the challenge of communication with the company’s leadership spread over the world.

“Their chairman in London wants to be kept in the loop with everything and sees it as a significant part of their overall strategy,” Allenby says.

Engentus

This mining supplies company sought a point of difference down the supply chain to increase its standing with ESG compliant customers.

“They have equipment lighter and easy to use, which helps more prominent companies diversify their workforce to operate the machinery — we are telling a human side to their story.

“It is an opportunity to do better and get that competitive advantage, whether that is shareholders, access to capital or getting a better deal.”

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