As researchers within higher and business education become evermore interested in the welfare of people and planet, we speak with Dr Ana Nacvalovaite, Research Fellow at Kellogg College, University of Oxford’s Centre for Mutual and Co-owned Business, about her focus on sustainability. 

Dr Nacvalovaite believes it’s right for academics to pay attention to ESG. She tells us more about her career, why now is the time to focus on ESG, and more. Here’s what she had to say:

Thank you so much for joining us in this interview. Before we dive in, please could you introduce yourself?

Thank you for having me. My background is in international human rights law, and I specialise in regulation of sovereign wealth funds. Currently, I am working on a project involving sovereign wealth funds (SWFs), sustainable investments, and co-operatives. I am hoping to show that by investing in co-operatives SWFs can pave a way for building sustainable communities for current and future generations.

As a prominent researcher within the higher education sector, broadly speaking, why are you passionate about sustainability? Has climate change affected your life in any way?

I am passionate about sustainability because it affects the health and well-being of the planet and all the species that live on it, including humans. Climate change is one of the most pressing sustainability challenges of our time, and it has significant impacts on our lives. Yours and mine. It is having an impact right now. For example, it can lead to rising sea levels, which can result in increased coastal flooding and erosion. This can harm homes and infrastructure, disrupt livelihoods and force people to relocate. Climate change can also result in changes in precipitation patterns, leading to more frequent and intense droughts and floods, which can harm food security, increase water scarcity and disrupt the availability of resources.

In addition to the impacts of climate change, sustainable practices can help conserve natural resources, reduce waste, promote social equity and support economic development. By being passionate about sustainability, we can take action to reduce our impact on the environment and help ensure that future generations have access to the resources they need to thrive.

Your research focuses on corporate sustainability and ESG – why is it time to focus on the ‘S’ in ‘ESG’?

There has been a growing recognition of the importance of considering the social impact of investments, not just environmental and governance factors. Investors are increasingly taking a more holistic approach to evaluating companies and considering the ways in which their business practices may affect communities, workers, and human rights. This has led to a growing emphasis on the “S” in “ESG” as a crucial aspect of sustainable investing.

Additionally, the COVID-19 pandemic has brought attention to systemic inequalities and social issues such as income inequality, access to healthcare, and labour rights. These issues are directly relevant to the “S” in ESG and the need for companies and investors to consider their social impact.

The social impact of investments is becoming more important as investors become more aware of the ways in which their investments can affect communities and society as a whole. By focusing on the “S” in ESG, investors can help drive positive change and contribute to the achievement of the Sustainable Development Goals.

You have said that the success of society is linked to the well-being of all of us, and that social development means investing in people. What does this look like in practice?

In practice, investing in social development means addressing social issues and creating opportunities for people to thrive. This can take many forms, including but not limited to:

• Education: Providing access to quality education, including vocational training and skills development programs, can help people acquire the knowledge and skills they need to succeed in the workplace.
• Health: Investing in health and wellness initiatives can help ensure that everyone has access to the care they need to maintain good health, regardless of their income or location.
• Affordable Housing: Providing access to affordable housing can help people to live in safe, secure and comfortable homes, reducing the stress and strain that can result from living in substandard housing.
• Job Creation: Investing in programs that create jobs and promote economic growth can help reduce poverty and increase financial stability for individuals and families.
• Social Services: Providing access to social services, such as child care, elderly care and support for people with disabilities, can help people who are struggling with daily life challenges.

These initiatives, and many others, are essential for creating a more equal and sustainable world, where everyone has the opportunity to reach their full potential. By investing in social development, we can help ensure that all members of society have the support they need to thrive, and that everyone can contribute to building a better future for generations to come.

Having had experience in guiding investors and businesses on aligning their portfolios with their environmental and social objectives, how far has business come in recent years when it comes to meeting SDGs?

In recent years, there has been a significant increase in the number of businesses and investors incorporating sustainable development goals (SDGs) into their strategies and practices. The recognition of the role that business and finance can play in achieving the SDGs has grown, and there has been a corresponding increase in the number of initiatives, frameworks, and best practices aimed at integrating sustainability into financial decision-making.

However, there is still a long way to go. While some businesses and investors have made significant progress in aligning their portfolios with environmental and social objectives, many others continue to face challenges in embedding sustainability into their operations and decision-making processes. The financial industry has a critical role to play in accelerating progress towards the SDGs, but much work remains to be done to ensure that the financial system is truly sustainable and supports the transition to a more equitable and sustainable world.

In practice, this means prioritizing investments in areas such as renewable energy, energy efficiency, and sustainable agriculture, as well as in companies and initiatives that are working to address social and environmental challenges, such as poverty, inequality, and climate change. It also means considering the broader impacts of investments and ensuring that they align with the SDGs and contribute to sustainable development. Ultimately, it means recognizing that sustainable investing is not only good for the planet, but also good for business, communities, and future generations.

Finally, why do you think higher education, particularly academics, should pay attention to ESG?

Higher education and academics should pay attention to ESG considerations for several reasons:

1. Relevance to real-world challenges: ESG issues are at the forefront of many of the major challenges facing society, such as climate change, inequality, and ethical business practices. Higher education should reflect and respond to these challenges and equip students with the knowledge and skills to tackle them.
2. Interdisciplinary nature: ESG encompasses a range of disciplines, from economics and finance to sociology and environmental science, making it a relevant area of study for many academic fields.
3. Career opportunities: As ESG considerations become increasingly important in the business world, there will be a growing demand for professionals with knowledge and skills in this area. Higher education can help prepare students for these careers.
4. Responsible citizenship: Higher education institutions have a responsibility to promote responsible citizenship and equip students with the knowledge and skills to make informed decisions in their personal and professional lives. Understanding ESG is critical in this regard.
5. Investment opportunities: ESG considerations are becoming increasingly important for investors and financial institutions, and understanding ESG can provide new investment opportunities for academic institutions and their endowments.

Overall, higher education and academics should pay attention to ESG because it is a crucial area of study that can have a significant impact on society and the economy, and can help prepare students for the future.