ESG performance is important for both short and long term success. Startups that integrate effective strategies across environmental, social, and governance dimensions:

1. Attract capital and top tier talent. 76% of VCs in a recent PwC study consider ESG in their investment process. 71% of adults in a recent IBM study shared that they are more likely to accept a job from a company they consider socially responsible, and 50% would accept a lower salary from such an organization.
2. Reduce risks and stay ahead of regulatory requirements. In the past few years, there has been an increased emphasis on ESG-related regulation, both through the SFDR implementation as well as new disclosure regulations by the SEC in the US around diversity & inclusion as well as climate-related disclosures.
3. Win enterprise customers and consumers who prioritize sustainability. 83% of consumers think companies should be actively shaping ESG best practices.
4. Diverse teams financially outperform their peers. A McKinsey study found “companies with more than 30 percent women executives were more likely to outperform companies where this percentage ranged from 10 to 30, and in turn these companies were more likely to outperform those with even fewer women executives, or none at all.”

We believe integrating high ESG standards can benefit companies in the following ways:

• Enhance customer loyalty to their brand, drawing additional customers and stakeholders
• Attract and retain best talent
• Increase team productivity
• Access impact capital typically reserved for mission-driven companies
• Adhere to client’s ESG requirements (specifically related to diversity and carbon emissions)
• Exercise the best standards when considering an IPO or M&A
• Comply with ESG disclosure regulations in Europe and US

A survey shows that 59% of US consumers consider a company's purpose and values to be crucial factors influencing their purchasing decisions. This sentiment is particularly strong among millennials, where 83% of consumers desire brands that align with their own values.

In summary, ESG can provide a competitive advantage in the following ways:

Photo source: Antler