Did you know that ESG practices in Asset Management generate many positive and lasting results for the business? Read the article and learn how!

Asset management is an area dedicated to resources management. It can positively impact environmental and corporate governance (ESG) through efficient management of natural resources and by enabling companies to make decisions based on reliable information about the environmental and social risks associated with their business.

In this article you will better understand how asset management processes are aligned with ESG practices and generate many advantages for the governance of organizations.

First, what is ESG?

ESG (Environmental, Social and Governance) has become increasingly important in asset management. It is a set of indicators and methodologies that help assess the social or environmental impact that certain investments can have.

Thus, investors can consciously make decisions to reduce or avoid exposure to risks by relating to companies with problems related to money laundering, environmental damage, scandals on ethical and social issues, labor and legal proceedings, among others. But what does this have to do with asset management? Better understand this impact.

How can asset management positively impact environmental and corporate governance?

Asset Management is a modern, holistic and dynamic way of managing assets, i.e. the financial, human and physical resources of an organization. The objective of Asset Management is to strike a balance between risk and performance, minimizing risk to an acceptable level.

One of the most useful tools for multi-asset management is the integration of Socially Responsible Investment (ESG) criteria. Including ESG criteria in asset management provides organizations with greater coverage of issues important to their long-term and performance. Among the main impacts, we listed the following.

Improves indexes

Asset management can significantly improve business outcomes. It enables companies to optimize their processes, reduce costs, and maximize the value of their assets. In addition, it also contributes to increase team productivity and improve the quality of products and services. All these indices contribute to the company becoming more sustainable in the long run.

Reduces waste

Asset management also implements processes that reduce waste on the production line. This is possible thanks to the monitoring and control tools that management offers. With them, you can quickly identify errors and correct them before they cause major damage.

Improves the quality of employees’ work sector

ESG also has to do with promoting a safe and quality working environment, and asset management contributes to the well-being of workers. In addition to preventing problems that can affect the operation of operations, it also contributes to a safer and healthier workplace, as it prevents employees from being exposed to risks inherent to the company’s activities.

Reduces the environmental impact of company operations

Asset management provides the company with tools to identify the assets that consume the most energy, and thus take steps to minimize or even eliminate that consumption. In addition, asset management also contributes to the reduction of waste generated by the company’s operations, as it encourages the reuse and recycling of materials.

Thus, asset management is an important tool for reducing environmental impact and waste, in addition to promoting quality of life in the work environment. All of these results are aligned with ESG practices.

Want to learn more about how to intelligently adopt ESG in Asset Management right now? Request the Manusis4 demo and learn how to manage the industry masterfully!