On September 24th, SHE Conference will co-host an event for Oslo Innovation Week with EY, our 2024 presenting partner. At the conference earlier this year, EY captivated the audience on the main stage with valuable contributions from Christin E. Bøsterud (Chief Sustainability Officer, EY Nordics). Arbab Dar (Country Managing Partner, EY Norway) held the opening address in Oslo City Hall. EY’s executive workshop, and the Four Futures experience on expo were also highlights for attendees. We are honored to continue our partnership with this event, which spotlights how top private equity firms deploy ESG and impact strategies to drive both financial success and societal progress.
Do you want to learn more about the transformative potential of private capital and how to become attractive to investors? Sign up for free here.
This event is tailored for those seeking to align their vision with purpose and who would like to be part of the change where impact enhances performance. There will also be an afterwork with a DJ on the rooftop afterwards - the perfect opportunity to network!
Impact Takes Center Stage
In this article, we share an interview with two of the panelists, Linn Anker-Sørensen (Associate Partner, Global Lead of Sustainability Regulatory at EY Law) and Jan Henry S. Fosse (Partner at EY-Parthenon). They discuss the evolving landscape of ESG regulations, the challenges of avoiding greenwashing, and strategies for integrating impact into investment decisions. These conversations offer a preview of the key insights they will bring to the stage at the event.
The Critical Role of Transparency in Sustainable Finance
Linn Anker-Sørensen has followed the development of sustainability law since 2009 as a legal researcher and advises clients in strategic orientation, disclosure regimes, sustainable corporate governance, supply chain due diligence and evaluation of green investment and asset ratios. Linn holds a PhD in Law.
Sustainable finance plays a crucial role in the broader transition towards a more sustainable business environment. Linn Anker-Sørensen likens it to the oil that keeps the machinery running smoothly. According to Linn, achieving sustainable change depends heavily on the decisions made by financial institutions and investors. These entities are under increasing pressure to guide their choices in a sustainable direction, which not only drives competition but also shapes the overall market landscape. The European Commission has reinforced this by emphasizing that companies with strong environmental and social commitments will gain access to more favorable financing options, including cheaper rates, better insurance, and long-term investors.
However, with the rise of sustainable finance, the risk of greenwashing has also become more pronounced. Greenwashing, as Linn explains, has evolved beyond blatant falsehoods. Today, it encompasses any use of labels, icons, or generic statements that lack the backing of robust processes or control systems. Companies can no longer simply claim to be impactful—they must provide concrete evidence to substantiate these claims. The regulatory environment has become more stringent, requiring financial institutions and businesses to define and measure their impact with greater precision. This shift is crucial in avoiding greenwashing allegations and maintaining the integrity of sustainability efforts.
Linn’s experience at EY has deeply informed her approach to helping clients navigate the rapidly evolving landscape of Environmental, Social, and Governance (ESG) regulations. She emphasizes the complexity of the regulatory framework, which is intricately linked to local requirements. For example, reporting obligations are not standalone—they are intertwined with local laws and regulations, such as those governing gender pay gaps, pollution, ecodesign of products etc. Understanding this multilayered regulatory environment is essential for any company wishing to make credible and impactful investments.
Compliance is the first step on the strategic ladder, but Linn believes that it’s just the beginning. She advises clients on how to anticipate and prepare for future regulatory changes, ensuring they remain ahead of the curve. Moreover, Linn stresses the importance of clear and safe communication, particularly in avoiding the pitfalls of greenwashing.
“Companies must be transparent about their impact and provide detailed documentation to support their claims.”
As the demand for transparency and accountability grows, Linn Anker-Sørensen emphasizes that businesses should be just as thorough in their documentation as they are in their sustainability efforts. This approach not only helps maintain trust but also drives genuine, impactful change in the market.
Balancing Financial Returns and Global Challenges
Jan Henry is a partner at EY-Parthenon, the global strategy practice of EY based in their Oslo office. He leads the Nordic sustainability strategy and transactions practice and focuses on energy transition, climate technology and resource efficiency topics.
In the ever-evolving landscape of private equity, firms are increasingly challenged to balance the pursuit of financial returns with the need to address global challenges such as sustainability and social impact. Jan Henry Fosse provides a nuanced perspective on how private equity firms can navigate this complex terrain.
Jan Henry acknowledges that the emergence of regulations like the Sustainable Finance Disclosure Regulation (SFDR) in Europe has pushed many firms to reassess their strategies. Initially, there was widespread uncertainty as firms grappled with what it truly meant to engage in sustainable investments. Over time, however, as the interpretation of the regulatory framework has matured, a clearer path has emerged. Firms with well-defined investment strategies that align with overarching impact goals find it easier to balance environmental, social, and financial objectives. This clarity allows them to approach the transaction phase with a focused understanding of the commercial and impact-related aspects of potential investments.
However, Jan Henry points out that one of the significant challenges in this space is the tendency to view commercial and financial value drivers in isolation from impact considerations. This siloed approach may lead to missed opportunities to fully leverage the intrinsic impact potential of a company. He argues that having a clear, integrated view of both impact and financial drivers from the outset is essential. This integrated approach ensures that firms do not miss out on key value creation opportunities.
The journey towards impactful investments is not without its trade-offs. Jan Henry draws a parallel between today’s sustainability-driven transformation and past transformational triggers, noting that while the current shift is critical, it is also fraught with regulatory complexities. These regulations, while necessary, can sometimes obscure the fundamental value drivers that firms should focus on.
“The challenge lies in not getting lost in the regulatory maze but using it as a framework to drive meaningful change.”
Jan Henry also highlights the importance of understanding the different lenses through which private equity firms must view their investments. For instance, investing in a "brown" company—one that currently has low sustainability credentials but holds potential for transformation—requires a different approach than investing in a company already positioned as a sustainability leader. In both cases, rigorous due diligence and post-transaction planning are crucial. Yet, Fosse notes that impact and sustainability are often compartmentalized, handed off as separate issues rather than being fully integrated into the overall value creation plan.
Addressing the growing distrust towards claims of impact and value creation, Fosse emphasizes the need for a clear, quantifiable logic behind these claims. In a world rife with greenwashing, it is not enough to make grand promises; firms must be able to substantiate their claims with firm data and clear metrics. This approach not only builds trust but also ensures that the impact is real and measurable.
In supporting private equity firms, Fosse’s approach is pragmatic. He advocates for a focus on the totality of value drivers, integrating commercial and impact considerations from the earliest stages of investment strategy development. This holistic view ensures that sustainability is not seen as an additional burden but as an integral part of the value creation process.
In conclusion, Jan Henry Fosse offers insights for private equity firms striving to balance financial returns with sustainable impact. By adopting a clear, integrated approach and focusing on substantiating their impact claims, firms can navigate the complexities of today’s investment landscape and drive meaningful change.
Towards a Sustainable Tomorrow
As the landscape of sustainable finance and private equity continues to evolve, the insights from Linn Anker-Sørensen and Jan Henry Fosse is a vital roadmap for the journey ahead.
Their expertise highlights the importance of integrating ESG (Enviromental, Social, Governmental) considerations deeply into investment strategies, ensuring that impact is not only a buzzword but a measurable and meaningful part of business operations.
As we look ahead, the demand for transparency, accountability, and genuine impact will only grow stronger, making it imperative for firms to stay ahead of the curve.
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The panel will be moderated by Michelle Chinnappen, and other speakers include Ellen Marie Nyhus (CEO of Verdane Elevate), Marianne Wangen-Eriksen (Investment Associate at Sandwater), Jonas Kjellberg (Founder and Chairman of the Board at NORNORM ) and Astrid Rønning Skaugseth (CEO of SHE Conference).
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