Embracing ESG principles in securities finance

In recent years, interest in ESG investing has skyrocketed, and for good reason. Environmental, social and governance issues carry tremendous importance in our society and our world. Survey data from Natixis Investment Managers found that three-quarters of professional investors are now implementing ESG strategies, and 77% of individual investors say it’s important for their investments to be aligned with their values. 

The current spike in interest reflects investors’ growing expectations that their capital be used to make the world a better place. And that means that every company–no matter its origin story–must embrace ESG principles in their business practices.

At EquiLend, we are striving every day to commit more closely to the E, S, and G principles that we hold dear, while reflecting on how to strengthen the values we’ve embodied before “ESG” was the hottest topic in the world. In this post, I hope to share a few of those values and commitments to hold ourselves accountable while inspiring others in securities finance to do the same. 

We are not perfect. We are taking guidance from those who are more experienced and transforming our business as quickly as we can. What we do know is that we are deeply committed to conducting our business in a way that not only lets us sleep at night, but also creates a positive impact in our industry and our communities. 

Let’s talk about how.

One of the ways EquiLend is supporting ESG initiatives broadly is through our membership on the International Securities Lending Association’s (ISLA) ESG committee, which is currently reviewing ways to integrate corporate governance policies around voting into market best practices. Voting allows shareholders and securities owners to influence corporate behavior related to ESG and sustainability. Voting can also be a way for ESG-minded investors to hold senior corporate management accountable on climate change, diversity, or human rights issues.

We’ve held the “S” in ESG at core since day one. Our team has always seen and felt the impact they can have through philanthropy and charitable giving – both through monetary resources and volunteering time. Doing good for those around us is part of our culture and DNA, and it has grown organically, which is a testament to our team’s commitment. Our most recent examples include our US team participating in the 2021 Wall Street Run & Heart Walk and our UK team raising money for VaccineAid, to help provide COVID-19 vaccines to those with limited access.

The G has been a particular focus for the past four years and we have made strong progress. We have overhauled our Board of Directors, appointed new independent directors and created a committee structure whereby the Board has a higher level of review. These changes are critical to our success going forward. We recognize the need to evolve, consistent with governance evolutions in the marketplace. 

E is one area that we know we need to dedicate more energy to. Don’t get me wrong, we do our bit for the environment. Our London office and US data centers are 100% renewable energy-powered and we have eliminated unnecessary paper usage. We also recently held an Earth Day competition to bring awareness to environmental causes and to encourage employees to do environmentally friendly activities. But we can do more and we will bring more focus to it in the coming months. 

While activities around DEI are separate from ESG initiatives (they are often incorrectly lumped together), organizations need to understand and actively embrace both concepts in order to create a culture of progress and build the foundation for a brighter future. On that front, we’re very proud to be recognized among LGBT Great’s 2021 Top 100 Executive Allies. Additionally, we have focused on equipping our employees with greater understanding of D&I issues. We have hosted guest speakers virtually throughout the pandemic on topics such as gender identity and working parents.

I firmly believe that the momentum around ESG is here to stay, and that this is a positive development for the global financial industry, and the whole world. It can be hard to know where to begin, especially during these unprecedented times. But by leading more mindfully and committing to being a positive, robust participant in the securities finance industry, we can all make a difference and play a role in building a better world.