Global BV News: Emerging markets ramping up ESG efforts, per BCG

BVWireIssue #247-1
April 5, 2023

global business valuation
cost of capital, international business valuation, international cost of capital

Although they had a slow start getting on the ESG bandwagon, emerging markets are catching up big time. And they are finding that sustainability efforts are a “powerful source of competitive advantage,” according to a new Boston Consulting Group (BCG) report. “Recent BCG research has found a strong correlation between emerging market companies’ scores in environmental, social, and governance (ESG) indexes as well as key financial and valuation metrics,” the report says.

BCG put together a list of 50 global firms it identifies as “climate pioneers” that have “generated total shareholder returns for investors that, cumulatively, were nearly 35% higher than the S&P 500 Index and 105% higher than the MSCI Emerging Markets Index from 2017 through 2022.” Valuation experts should also take note that firms are leveraging their high ESG scores into securing low-cost capital. The report is “The Sustainability Imperative in Emerging Markets,” which can be downloaded if you click here.

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