Woke Capitalism

is good for
Business
Group 1
 Topline Growth and Reduced Costs Reduced regulatory & legal problems

Better sustainable investment and Retention of better talent and boost

reduced cost of capital to employee productivity

Strong ESG Proposition Weak ESG Proposition

Top Line
Stakeholder Capitalism
Attract B2B and B2C customers with Lose customers by poor sustainability
Growth more sustainable products practices (human rights, supply chain)

fueling growth of Cost Lower energy consumption Generate unnecessary waste and pay
Reductions Reduce water intake higher waste-disposal costs
today’s corporations
Stark Difference in Total Shareholder Return Between
Leaders and Laggards
 Investment and Asset Optimization

High-rated ESG companies exhibited

45% 33.9T$
Above-market valuation and profitability
planning AuM in
Lower cost of capital both debt and equity
new funds 2026
Low systemic risk

21%21
of 12.9%
12.9
Total AuM CAGR

Monthly averages were reported over the period from Dec. 31, 2015, to Nov. 29, 2019. The average number of companies in the MSCI World Index and MSCI Emerging Markets
Index over the analysis period was 1,552 and 960, respectively.
Investor Sentiment
ESG key driver Non ESG a deal- Higher yields
Replacing asset price growth
breaker
Stop investment in corporate 60% report higher yield on ESG
Traditional growth engines products
due to low ESG efforts?
threatened by economic Push for more ESG products
headwinds Demand outstrips supply
Shift to ESG as a counter 44% 42%
balance
Yes No
But
would
consider
doing so

14% No
Aligning with employee sentiments

2.3-3.8%
higher stock
returns
Why increase Employee Satisfaction
Paying attention to ESG concerns does not
compromise returns- rather, the opposite
Result of >2000 studies on the impact of ESG propositions on equity returns

63%
8%

Share of positive findings Share of negative findings

Source: Gunnar Friede et al., "ESG and financial performance :Aggregated evidence from more than 2000 empirical studies," Journal of Sustainable
Finance & Investment, October 2-15, Volume 5, Number 4, pp.210 -33; Deutsche Asset & Wealth Management Investment;Mckinsey Analysis
Thank you!
 The New York Times - The Rise of Woke Capital
Asset and wealth management revolution 2022: Exponential
expectations for ESG- PwC report

Resource
Weighing the Evidence: ESG and Equity Returns- MSCI Feb 2020
Socially Transformative Business Is Smart Business- BCG, 2023
Five ways that ESG creates value - by Witold Henisz, Tim Koller, and

Page
Robin Nuttall, Nov 2019 Mckinsey
Banks Can Bet Big on Social Impact- BCG, Dec 2022
The New York Times - Woke Capitalism
Great Place to work - Financial Performance
Alex Edmans, Does the stock market fully value intangibles? Employee
satisfaction and equity prices, Journal of Financial Economics,
Harvard Business School - The Triple Bottom Line
Grant, A. M. (2008). Does intrinsic motivation fuel the prosocial fire?
Motivational synergy in predicting persistence, performance, and
productivity. Journal of Applied Psychology, 93(1), 48–58.
Employee engagement: how to keep workers engaged in a meaningful
way
Beyond Happiness and Satisfaction… What is Employee
Engagement?
The Correlation Between Productivity & Employee Engagement in an
Organisation