The Next Big Thing ESG panel.

"Companies, employees and investors demand today a product with an impact"

"The advantage of high-tech is the ability to fix problems that affect the entire world," said Cecile Blilious, Head of Impact & Sustainability at Pitango Venture Capital, speaking as part of Calcalist and KPMG Israel’s The Next Big Thing session

"Technology has an infinite ability to present solutions and many times one investment can touch millions of people," says Cecile Blilious, Head of Impact and Sustainability at Pitango Venture Capital while speaking at Calcalist and KPMG Israel’s The Next Big Thing session. "The big promise of high-tech is in helping to fix problems on a global scale and create new paradigms that will allow us to build a world we want to live in."
The session this year focused on ESG (Environmental, Social and Governance) investments and impact investments that focus on environmental responsibility, social justice and corporate governance. Investments of this kind have become a binding standard in recent years in the business sector and there is a growing interest in the investment world as well.
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פאנל KPMG הדבר הגדול הבא ESG
פאנל KPMG הדבר הגדול הבא ESG
The Next Big Thing ESG panel.
(Photo: Calcalist)
"ESG is first and foremost a state of mind," Blilious explains, "it's a decision of how you run your corporation internally: how the company is run, who its employees are, how diverse it is, how much it contains, how it treats the environment and how its corporate governance works. Every company needs a high ESG, which meets international standards. However, the impact it makes relates to the business model and the product to the outside world, and what the company needs is high ESG and a positive social or environmental impact." |
Shahar Botzer, managing partner at Good Company, added that "ESG is a common layer in all areas. Today, companies are expected to behave responsibly with their employees, suppliers and the environment. The emphasis with us is to invest in products that solve significant problems in the world and there will be a fit between the goal and the product. We also put a lot of emphasis on the intention of the entrepreneurs: how much they really want to solve a problem in the world and if that is why they founded the company. Yes, they want to make money but they also have a purpose and the corporate culture needs to be right."
According to Ran Grodecki, managing partner at Bridges Israel, "We look at ESG companies like any other investment. On the one hand we want to see strong management, strategy and excellent product that has a relative advantage. On the other hand, we will not invest in a company that does not solve one of two major problems. A significant social problem such as growing inequality; or a problem related to the Earth's crisis, which includes climate, water shortages, food, pollution, etc. Only when the financial aspect and impact connect - will we invest."
Grodecki added: "Young people today are committed to their values: that their product will be greener, environmentally friendly and not cause harm. Employees are also looking for and demanding to work in companies that have an impact. Take two offers with equal pay - the candidate will choose meaningful work. Eventually investors are also starting to flow in that direction: these companies are facing very big problems. If such a company manages to find a solution with a relative advantage and it approaches a global market and solves a global problem - it will be a company with large revenues and a very high value."

According to Dina Pasca-Raz, Partner, Head of Technology at KPMG Israel, "Companies we would not think of are also interested in ESG. For example, in the field of fintech, they turn to areas in Latin America and Africa that do not have access to credit and banking and allow bank accounts via cellular, and allow access to credit for people who do not have it."
But in her view, "although there are social values here and a desire to make the world a better place, in the end no one gives up on profit. Everyone wants a business model that works. There is competition, especially in the environmental aspect." Another problem she says is in production: "Ultimately there is a physical clause. And when we talk about production it is actually a capital investment, and it takes longer to set up these factories. For example in the field of meat substitutes - the product already exists and the question is how to reach mass production."