We live in an era of acronyms and shorthands that help point the way to business concepts, which in turn can redirect the way companies conduct daily operations.

Stuart Roberts, global head of trade at JPMorgan Chase and Lori Schwartz, global head of liquidity solutions, said that ESG (short for environmental, social and governance) considerations can help transform financial and liquidity management.

At a high level, ESG can provide treasurers and CFOs with a beacon to ensure that the projects they fund can achieve a fair distribution that benefits the entire economy. Of course, the nuance is important. Companies are different from each other; so are financial staff. As Schwartz and Roberts said, ESG has matured and can undergo various "disintegrations", some of which can be dominated by individual components.

As Schwartz pointed out, ESG is "We seem to have heard of it recently - and it's becoming more and more important." Roberts said ESG is increasingly becoming part of a company's key performance indicators (KPIs), he added. In short: this is no longer just about profits, but about how the company gets those profits. They told Karen Webster that by conducting more in-depth research on these pursuits, financial professionals can examine cash flow and liquidity management in a variety of ways, and how their business affects society, the economy, and regulatory forces. , And how to be affected by social, economic and regulatory forces.

Roberts pointed out that ESG is a fairly broad term that can cover a range of key areas. He argued that in Europe, investors and other observers — and of course the executives themselves — tend to focus on environmental issues. In North America, they are increasingly focusing on including more minority-owned companies and suppliers-as Roberts said, a key question must be asked: "How do you promote equity by injecting capital?"

Schwartz added, "How do you implement governance to ensure that you don't inadvertently fund unethical behavior?"

Using these issues as key drivers can help determine where companies focus their resources. For example, textile companies are making specific efforts to ensure that they do not use suppliers that use forced labor.

Roberts said these examples of narrowing the focus show that ESG means different things to different electoral districts. Schwartz said that recently, products promised to enter the market with "green deposits" may pique the interest of finance executives—or cause confusion. "My encouragement to all corporate treasurers is to double-click the real meaning and meaning," she said.

Roberts said that reaching a consensus around ESG will require governments and regulators to develop guidelines and incentives—and transparency in the global trading community. Schwartz said that CFOs need to consider the governance framework as liquidity components, and can also include their ESG scores.

Schwartz and Roberts stated that these frameworks will be particularly important given that we are providing financial executives with the second generation of ESG-focused investment products.

As Schwartz pointed out, banks including JPMorgan Chase are making and marketing ESG-centric products that reward customers with products that provide companies with higher deposit rates based on ESG scores. Banks can also help business customers understand their data (and recommend external consultants and partners) to pursue a successful ESG strategy.

Roberts and Schwartz suggested that these measures will greatly promote the progress of the United Nations' 17 Sustainable Development Goals. These include gender equality, sustainable water management and climate change.

But so far, Roberts said, "We have not seen a large-scale, coordinated public fiscal policy push at the developer or [OECD] level."

At the same time, they stated that JP Morgan Chase will work in a tactical and company-by-company manner to respond to ESG initiatives.

"This is an evolving space," Schwartz said. "A small step can be a step in the right direction. "

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