Financial Services and Societal Impact – Investing in Levelling Up

Activists have been keeping busy in recent years, and particularly in the last 12 to 18 months, promoting societal impact issues such as social justice, gender and racial equality, social inclusion, sustainable communities, access to healthcare, and equitable governance-related values. But they are not alone.

Levelling up

The Government has placed ‘levelling up’ on the agenda. On the 15th July 2021, Prime Minister Boris Johnson set out a “skeleton” plan to “level up” the country, by spreading power and opportunity more evenly. Likewise, an increasing number of corporate entities have declared that they are committed to promoting ESG values. Issues related to human equality, access to healthcare and societal welfare are not only top of the boardroom agenda, organisations (from large enterprises to SME organisations and start-ups) are making it very clear that they only want to bank, invest, insure and so on, with firms that reflect and share these views and concerns.

A shift of focus from profits to people

Take, for example, The Social Mobility Pledge. A coalition of 550 businesses and 50 universities committed to levelling up by encouraging organisations to be a force for good by putting social mobility at the heart of their purpose. The coalition aims to set the standard for the social aspects of Environmental, Social and Governance issues (ESG) – education, employment, access to finance, health, enterprise, closing the digital divide, infrastructure for opportunity, sustainable housing and communities, energy transition, equality, diversity and inclusion.

So, what does this mean for financial service institutions (FSIs)?

Aldermore, the specialist banking group, has committed to playing a key role in levelling up the UK. Challenging the financial service industry to do better and open up finance to people and businesses who are not being looked after adequately. As part of that pledge, it signed up as an accredited lender under the Asset Finance variant of the British Business Bank’s Recovery Loan Scheme (RLS), having previously been an accredited lender under the Coronavirus Business Interruption Loan Scheme (CBILS) and the former Enterprise Finance Guarantee scheme to assist SMEs affected by the Covid-19 pandemic believing that they are the backbone of the UK economy.

Likewise, taking a strong social impact stance is Triodos Bank. Triodos has a mission to make money work for positive change. It does this by financing businesses and organisations that are making a lasting positive impact on society, culture, or the environment. In a pledge to do its very best to support customers and other ethical organisations it has likewise become an accredited lender under the RLS scheme. Triodos prides itself on understanding the challenges its customers face so that it can deliver flexible and individualised support and well as assisting them to play their part in building a more socially inclusive society.  

But typically this is where things get tricky for FSIs.

Tackling the social insight problem

There is also a data problem that FSI organisations are finding it hard to get to grips with. The ‘E’ (Environmental) part of ESG is a relatively data-rich area and one where a firm’s climate impact is increasingly straightforward to capture. However, when it comes to the corporate social responsibility and governance parts of the ESG agenda, it gets a bit trickier, especially as this is an area very susceptible to ‘greenwashing’.

So, what are organisations like Aldermore and Triodos doing to overcome this social insight problem?

Most FSIs don’t have a centralised ability to collect and analyse ESG data. Why? Because ESG data (particularly the S and G parts) takes many forms and can be found in many places (internal, external, structured, and unstructured), its highly dynamic making it hard to keep up let alone analyse and react, and finally because ESG data is big data and analysing it is a huge undertaking.  

In 2020 Triodos Bank deployed a holistic relationship management platform designed to support ethical organisations (businesses that provide real impact on society or the environment) in partnership with Artesian.

Make positive societal impact a reality with Artesian

Artesian provides instant access to sector news, which can be focussed on key societal impact topics such as gender equality, education for all, or racial justice, for example. This provides a rich selection of market news stories that can be used to uncover new opportunities to build socially responsible investments, inform customer engagements and trigger meaningful conversations, or uncover potential risks that are either damaging to society at large or specifically to the reputation of the client, or indeed the FSI itself.

By applying Artesian’s taxonomy of 2,250+ topic filters to a list of target companies, banks and FSIs can receive highly relevant, accurate and refined ESG insights that can be used to personalise messaging, improve client engagement, or generate content ideas. With natural language processing and machine automation, this can be done at scale across an entire client book, giving users the ability to intimately understand their customer’s world, their impact on society and their sustainability society and governance-related risks and opportunities, and use this to provide a better service through tailored solutions that both assist the transition and fund levelling up.  

Get in touch today to find out how Artesian is already helping FSIs spot ESG risks and opportunities, channel their activities and sales behaviours to lead from the front and harness the ESG intelligence needed to invest in the transition, innovate, educate and fund the future through levelling up.