Up to 80% of the market cap of companies are not additives in a balance sheet according to financial reporting standards. This percentage is made up of environmental, social and governance issues. These so-called ESG factors include how the board of a company is acting as a steward of nature, the quality of its social relationships with its stakeholders and how the company is being led and managed. People and planet have become important because of the resource constraints of planet Earth. Society wants to be able to draw the reasonable conclusion that the company is adding value to it and in making its money is not adversely impacting on the environment.

The modern corporate governance trend is a wide rejection of the notion of the primacy of the shareholder and the adoption of taking account of the needs interests and expectations of all the company’s stakeholders with the board making decisions in the best long-term interests of the health of the company. This trend is evidenced by the growth of ESG funds in the capital markets of the world.

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