Research

The operating environment for charities has become less benign in recent years. Changes in state funding for charities, the need for more diverse and creative income generation and concerns about executive pay, fundraising practices and the governance of some high-profile charities have all led to a perception that public trust in the sector is in decline.

This paper seeks to outline the rise of environmental, social (or sustainability1) and governance factors (ESG) in the commercial sector and explain how they will become increasingly relevant to modern charities. It covers the drive behind the increasing use of ESG factors in investment decisions, reputational risks, environmental awareness amongst consumers and clients and the need to attract talent with different motivations to work.