ENERCOM ANALYSIS
ESG and the Oil and Gas Industry
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Corporate Social Responsibility Report (CSR) is a document that summarizes a company’s self-regulation strategy that is designed to guide the organization’s
actions and activities in pursuing a sustainable financial return for shareholders, as well as a positive impact on the environment, consumers, employees and communities.
ENERCOM HAS CONSISTENTLY FOUND THAT: • Growing public expectations around corporate responsibility is increasing the pressure on institutional investors to invest in sustainable businesses. Moving forward, a CSR strategy will become a requirement for access to lowcost capital for the oil and gas industry. • More and more companies in the oil and gas industry are
Contained within the CSR report are Environmental, Social and Governance (ESG) benchmarks and indicators used
quickly developing
Moving forward, a CSR strategy will become a requirement for access to low-cost capital for the oil and gas industry.
to quantify and track a company’s progress and improvements in sustainability and are the metrics used by a growing number of investors to help determine the longer-term financial performance and health of a company. There is growing evidence to support the theory that companies that adopt an effective ESG strategy can gain many competitive advantages, including a more stable investor base, lower cost of capital, broader access to financing, improved employee engagement and deeper customer loyalty. These benefits are vital to companies seeking to strengthen their corporate performance, maximize shareholder returns and maintain their social license to operate. Over the last year, EnerCom has met with oil and gas executives and the investment community to talk about Corporate Social Responsibility and ESG.
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ENERCOM360 M A G A Z I N E
a Corporate Social Responsibility strategy and ESG benchmarks to proactively address the rapidly growing number of institutional
investors that are employing varying degrees of ESG evaluation in their investment decision. • Although Environmental metrics, like sustainability programs focused on water usage and volatile organic compounds (VOC), methane and CO2 emissions reductions, have been a primary focus for investors in oil and gas, the first half of 2020 has heightened investor attention on the importance of the Governance and Social aspects of ESG, such as executive compensation, Board of Directors diversity and workforce recruitment of underrepresented populations. • Investor Relations Officers hate filling out multiple, different, ESG forms.
