September 2022
Fluxus contributed to the World Economic Forum’s new insight report “ESG Pulse Check: Getting the Basics Right for Start-ups and Venture Capital Firms”. Environmental, Social and Governance (ESG) is a holistic financing that leads the natural evolution of how companies are valued, with the transition from balance sheet to value sheet.
ESG assets are on track to exceed $50 trillion by 2025, representing more than a third of the projected $140.5 trillion in total global assets under management. The shifting macroeconomic and geopolitical environment has only increased its importance, further enhanced by a regulatory push to increase scrutiny on how companies as well as investors address ESG. This mounting pressure is being felt across all asset classes, and venture capital is no exception.
While venture capital firms are a critical force in shaping the future as they invest in the leading start-ups and disruptive technologies, the start-ups themselves have largely been left out of the conversation when it comes to ESG. Through this insight report, the World Economic Forum aims to highlight what start-up and scale-up companies are thinking and doing on the ESG front, and the assistance they are seeking to ensure that they can avoid greenwashing and implement standards and strategies early on.
“Companies are the catalyst to perform ESG and to create positive impacts beyond the immediate boundaries of corporations and industry verticals. For example, for companies that are committed to sustainable way of building, they should incorporate ESG as core of our businesses, not just an add-on, where measurable metrics are woven into the value chain for creating energy-efficient buildings and carbon-zero cities.” Fanyu Lin, Chief Executive Officer, Fluxus.
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