Factors Sociais e Oportunidades para Investidores no Contexto ESG

ESG Social Factors Gustavo Herkenhoff Moreira gustavohmoreiraprofessoresibmecedubr Social Factors Social Factors Investors need to understand the different social megatrends that could affect on the businesses of the investee companies Systemic relationships between these social megatrends and business activities can lead to material impacts of these trends on potential investment opportunities The US Needs to Reimagine Its Pharma Supply Chain httpsforbescombrforbesagro202203porquea dengopagamaisaosprodutorespelocacaudeseus chocolatesutmcampaignlaterlinkinbio forbesbrutmcontentlater 25652094utmmediumsocialutmsourcelinkinbio Implications for investors Social Factors Internal social factors Human capital development Health and safety Human rights Labor rights Freedom of association and employee relations Forced labor and Living wage External social factors Stakeholder oppositioncontroversial sourcing Product liabilityconsumer protection Social opportunities and Animal welfare and antimicrobial resistance These social megatrends will change the way we live work consume and perceive the world and as such will pose new risks or opportunities for investors Implications for investors Globalization Countries sectors and companies are affected differently by the social megatrends and social factors The analysis of which social factors are material from an investment point of view should start with an understanding of materiality at the geographical and industry levels Globalisation is caused by a rapid increase in crossborder movement of goods services technology and capital Depending on the viewpoint it can be viewed as either a positive and a negative phenomenon It has led and continues to lead to increased efficiency in the markets resulting in wider availability of products at lower costs Implications for investors Globalization Offshoring Due to the lower wage costs of workers in the garment industry in developing countries clothes are now mainly produced in countries such as Vietnam Bangladesh and China Offshoring also takes place in other sectors like IT Dependency As USbased and Asian companies dominate the industry for mobile telephones computers and other IT products Implications for investors Automation and artificial intelligence AI Automation which is the technology by which a process or procedure is performed with minimal human assistance Some of the biggest advantages of automation are Associated with faster production lower labor costs and greater quality and Replaces hard physical repetitive or monotonous work The largest social impact is that it displaces workers due to job replacement as technology renders their skills or experience unnecessary AI is expected to have a significant effect on sectors such as Ø Healthcare automotive financial services and auditing security including military creative in particular advertising and video games Social Factors Automation and artificial intelligence AI The transportation industry is currently on the brink of becoming more automated and it is expected that some jobs for drivers of taxis buses and lorries for example will disappear due to selfdriving vehicles This will be beneficial for companies that develop the best selfdriving cars but less so for traditional heavy goods vehicle HGV companies that do not innovate One of the largest expected implications of this is that by automating the transport industry major job losses will occur One possible solution is to invest in upskilling staff to enable their transition to a more AIenabled world Investors should take this into account when assessing the risks of an investee company Implications for investors Digital disruption social media and access to electronic devices Another important social trend is the rise of digital disruption which is the change that occurs when new digital technologies and business models affect the value proposition of existing goods and services This trend is closely related to the increased automation and rise of AI Some exemplary cases of disrupting companies include Amazon Uber Airbnb and Netflix They have managed to enter an existing market but with different and more digital business approaches than their competitors and have managed to turn the existing business models around For investors who are about to invest preferably at an early stage Implications for investors Digital disruption social media and access to electronic devices However controversies have arisen because some data is being used and sold in more extreme or socially unacceptable ways for example by social media companies such as Facebook Twitter and LinkedIn eg a political or marketing campaign as seen in the case of Cambridge Analytica Due to these types of scandals there is a debate around the growing need for regulating the industry This can affect the profitability of these companies and should be considered by investors The Internet of Things IoT is the next frontier where semiintelligent appliances called embedded systems communicate directly with each other and with the internet and make autonomous decisions For investors disruption represents both risks and opportunities Analysts need to take a forwardlooking approach to determine which sectors and companies will thrive and which will struggle in a digital society Data Management The New Rules of Data Privacy by Hossein Rahnama and Alex Sandy Pentland February 25 2022 3 Market competition Last year Apples upgrade to its iPhone operating system allowed users to shut down data harvesters ability to track them across their many apps It was a refreshing change providing customers with power and agency over their data It also bit hard into companies that rely on crossapp tracking it cost the major social media sites 10 billion in lost revenue in the second half of 2021 Facebooks parent company Meta expects it will cost another 10 billion to them alone in 2022 Apple has made privacy protection a market differentiator device manufacturers and app developers now use privacy features to draw new users Implications for investors Google plans privacy change similar to Apples which wiped 230 billion off Facebooks market cap Jessica Burzynsky An Android statue is displayed in front of a building on the Google campus on January 31 2022 in Mountain View California Google parent company Alphabet will report fourth quarter earnings on Tuesday after the closing bell Justin SullivanGetty Images Google on Wednesday announced its adopting new privacy restrictions that will cut tracking across apps on its Android devices following a similar move made by Apple last year that upended several firms advertising practices Google said its developing new privacyfocused replacements for its advertising ID a unique string of characters that identifies the users device The digital IDs in smartphones often help adtech companies track and share information about consumers The changes could affect big companies that have relied on tracking users across apps like Facebook parent Meta Apples adjustments hit Meta particularly hard for example Meta said earlier this month Apples privacy changes would decrease the social media companys sales by about 10 billion That news contributed to wiping 232 billion from the companys market cap in a single day eventually pushing the total below 600 billion Last June Meta was worth more than 1 trillion Cybersecurity is important to ESG Cybersecuritys critical role is protecting systems networks programs and data and is important to investors who typically examine data protection and information security policies to assess a firms cybersecurity risks While cybersecurity has mainly been viewed as a technology issue it is now also regarded as a key Social pillar By incorporating cybersecurity a new dimension is added giving insight into cyber behaviors and risks which form a critical part of the bigger ESG picture The adjusted average total cost of a data breach reaching 4 million per company In a booming digital economy cybersecurity is no longer just a software industry concern It is becoming a major topic for company management and deals with exposure to cyber technology and customers private information A far broader demographic is becoming increasingly concerned with cybersecuritys social impact as well as technological implications Cybersecurity is important to ESG Various industries suffer the the consequence of breaches and include fines andor reputational damage if they do not adequately protect their networks The sectors most relevant to this theme are Information Technology Consumer Discretionary Financials and Communications Services Security regulations have been introduced globally to enhance the protection of personal information reshaping corporate behavior towards data usage and security and include General Data Privacy Regulation in Europe EU GDPR 2018 the California Consumer Privacy Act CCPA and the Brazilian LGPD 2021 Compliance requirements drive corporate spending higher and may lead to financial losses if companies commit misconduct Hacking activities cybercrime and targets are global Implications for investors Ainda não há estimativa para restabelecer sistemas após ataque cibernético diz CVC A empresa diz que alguns sistemas relevantes para suas operações ainda não foram integralmente restabelecidos e que um ataque de forma diligente para mitigar os efeitos do ataque A CVC disse nesta terçafeira 11 que não há estimativa de tempo necessário para que sua ambiência de tecnologia esteja normalizado porque após ataque cibernético do tipo ransomware sofrido em 2 de outubro A empresa diz que alguns sistemas relevantes para suas operações ainda não foram integralmente restabelecidos e que um ataque de forma diligente para mitigar os efeitos do ataque Leia mais Com suas aquisições Padrão cria plataforma antihacker e a planilha IPO Ataque à Atento prejudica central de atendimento da Azul Companhia aérea informa que sistema de vendas está funcionando normalmente A companhia aérea Azul está com sua central de atendimento impossibilitada devido à ação de um ataque hacker sofrido pela empresa O sistema não está sendo autorizado e mesmo assim está com apenas um a dois atendentes disponíveis para o atendimento e como todos acabam se excessando a companhia informa que nenhum cliente vai conseguir conseguir atender Mercado Livre e terceira varejista alvo de ataque hacker em 6 meses Informações de 300 mil usuários foram vazadas segundo a companhia Depois do Reniere e Americanas agora o Mercado Livre sofreu um ataque de hackers a revelação invadiu plataforma online em cerca de seis meses disse o texto que os investidores leiam os mesmos que atuam em sites e atividades da Americanas em reverência Ora o ProconSP pediu esclarecimentos sobre o impacto e vazamento de dados de usuários da plataforma O que pode ter amanha para responder ao órgão Implications for investors Changes to work leisure time and education New technologies increasingly enable workers to be connected to their work from remote locations This creates an opportunity for employers and employees to adopt more flexible working patterns However the constant connection also makes the notion of worklife balance more elusive and can cause stressrelated illnesses Investors who are assessing companies that rely heavily on employees as a key asset need to pay attention to those companies human capital management strategies They should evaluate how the companies are coping with these structural changes in the labor market Implications for investors Changes to individual rights and responsibilities and family structures The workforce has become more diverse more women are now entering the labor market which has provided women with more financial independence However in comparison to men women are still more likely to become and remain unemployed have fewer chances to participate in the labor force and when they do secure employment often have to accept lower quality jobs Women also face wage gaps in comparison to men To improve gender equality a number of different initiatives have been created and there is growing evidence that a more diverse workforce leads to better financial results Some bestinclass funds and impact investors take diversity gender and other types of diversity into account in their risk analysis and stock selection Implications for investors Changing demographics including health and longevity This increased life expectancy combined with a falling birth rate have caused many developed countries populations to age the overall median age rose from 28 in 1950 to 40 in 2010 and is forecast to rise to 44 by 2050 30 32 34 36 38 40 42 44 2010 2020 2030 2040 2050 2060 Average population age Brazilian average population age An ageing population has substantial effects on society The ratio between the active and the inactive part of the workforce drops impacting national tax revenues and challenging pension systems Older people have higher accumulated savings per head than younger people but spend less on consumer goods which is a business risk for some industries In some categories such as healthcare expenditure rises sharply when populations age Implications for investors Urbanization In the 1950s approximately 30 of the world population lived in an urban environment This is expected to increase to 65 by 2050 This can have different kinds of implications for societies including Economic dramatic increases and changes in costs often pricing the local working class out of the market Environmental the existence of urban heat islands where urban areas produce and retain heat becomes a growing concern Implications for investors Social increased mortality from noncommunicable diseases associated with lifestyle including cancer and heart disease Residents in poor urban areas slums also suffer disproportionately from disease injury premature death and the combination of illhealth and poverty entrenches disadvantage over time These societal implications provide business opportunities because of the growing need for infrastructure development but also require companies to address social and environmental issues related to urban living for instance pollution and waste management systems Implications for investors Normsbased exclusion has been one of the first ESG investing instruments and many of these first movers were faithbased investors Religion Religion can have an effect on investment decision making A distinction should be made between exercise of religion as a social factor and faith based investing As a social factor the changing religious landscape around the world has consequences for consumer preferences Religionbased politics and conflicts can also have a profound impact on specific local economies Implications for investors Religion Religion can also play an important role in investors normsbased preferences Faithbased investors aim to invest their money in line with a specific named faith and the two most common types are Christian investors may refrain from investing in firms that support abortion contraceptives embryonic stemcell research weapons of mass destruction tobacco alcohol and pornography Islamic investors would not invest in companies that profit from alcohol pornography or gambling and also exclude companies involved in pork They will not own investments that pay interest or invest in firms that earn a substantial part of their revenue from interest Social Factors and investing Financial impact quantifying the impact of social factors Occupational health and safety issues accident and fatalities which can result in huge fines and liabilities Human capital management issues which can lead to greater operating costs if new employees need to be trained due to high employee turnover Supply chain issues which can impact brand reputation and revenues if consumers choose to boycott certain products Local protests that lead to business disruptions at plants or factories and Poor working conditions which can result in issues with product safety Higher discount rates to reflect a companys higher risk profile if it does not manage social factors appropriately Amazons biggest hardesttosolve ESG issue may be its own workers Todd Wasserman 28 ibmecbr IBMEC 29 Implications for investors Sequestro de dados desafia organizações setores mais atingidos por ataques com pedido de resgate são indústria saúde governo e finanças