How to Prepare Your Business to Meet Investor ESG Expectations

In the first two parts, we explored the importance and application of ESG, demonstrating its critical role in fostering sustainable business growth. This segment will examine how telecommunications giant AIS integrates ESG principles to create value and achieve sustainable development.

We will also explore investors' perspectives on ESG, understanding how essential they find ESG criteria and whether they influence their investment decisions. As businesses grow and seek expansion, attracting additional funding becomes necessary.

This topic is particularly relevant for businesses preparing to scale up. Learn how to align your operations with ESG standards to meet investor demands and secure funding for growth, with practical insights on incorporating ESG into your business framework.

Fireside Chat: ESG in Corporate

by Ms. Saichon Submakudom

AIS recognizes the importance and opportunities associated with ESG, integrating the ESG framework into its operations. This demonstrates that even telecommunications organizations, which may not have a direct impact on social and environmental issues, can use ESG to foster sustainability, guided by the clear goal of:

“Thriving in greener and inclusive Digital world”

• Drive Digital Economy
• Promote Digital Inclusion
• Act on Climate

Three Steps to Develop Talent at AIS

• Basic Needs
  

  AIS addresses employees' basic needs by ensuring competitive income and benefits, recognizing the importance of fair compensation aligned with market standards.

• Opportunity
  

  The organization fosters an environment of opportunity, creating a sandbox for experimentation without the expectation of immediate success. AIS has initiated various projects, such as competing with major news programs. While some efforts haven’t succeeded, they have fostered valuable relationships with media teams and provided staff with experience and growth.

• Passion
  

  Motivating employees goes beyond incentives; AIS cultivates enthusiasm, encouraging staff to break out of conventional boundaries and pursue innovative initiatives.

Thailand Cyber Wellness: Empowering Digital Literacy

AIS identified that increased internet access in Thailand correlates with a higher risk of online scams. As a telecommunications provider, AIS sees a valuable opportunity to engage socially in its business value chain while implementing ESG in its product offerings.

To address this, AIS launched the Cyber Wellness initiative, focusing on educating the public about cyber threats and scams. The program includes knowledge assessments and has expanded to involve academics in creating the Thailand Cyber Wellness Index for 2023, which surveys a representative sample across Thailand. The results will help identify weaknesses in digital literacy, guiding future curriculum development aimed at reducing online fraud. Regenerate Response

Regional VC Investment Thesis

by Ms. Minette Navarrete
Co-founder and president, Kickstart Ventures

Kickstart Ventures has evolved from the telecommunications industry into a collaborative investment organization aiming to grow and succeed together. The goal is to leverage innovation to create success opportunities for businesses focused on sustainability in developing countries or regions. The organization shares its perspective on what traits investors look for in growing companies that implement ESG principles.

Purpose: Start with Why?

Today, many of the world's significant social problems are challenging to solve alone; collaboration is essential for helping others. Addressing large-scale issues requires teamwork to break down barriers and create new opportunities. As a result, Kickstart Ventures invests in businesses poised for growth.

For participants within the same innovative ecosystem, even if they are unfamiliar with one another, community development can emerge. The focus is on gathering individuals to share knowledge and attract others to collaborate, fostering a culture of cooperation and sharing.

Investment Perspective of Kickstart Ventures Based on Innovation Eras:

• 2012: Early Stage – Focused on incorporating digital innovations. The arrival of the internet and mobile technology would transform people's lives. Initial investments were made in the Philippines and Asia, from Seed to Series A.
• 2015: Early/Early Growth Stage – With capital beginning to flow, investments expanded regionally to North America, Canada, Singapore, Israel, and Malaysia, moving from Series A to Series C for broader global exposure.
• 2020: Continuing in the early growth phase, the focus shifted to future trends. Understanding what will be important in the future was crucial for making appropriate investments aligned with the changing global landscape.
• Now: Kickstart Ventures has become a top tech venture capital organization in the Philippines, successfully nurturing two unicorns and assisting other businesses seeking funding for growth.

Process: Our How = “If” + “How much”

Evaluation Matrix for Assessing Businesses:

• Stregic Fit:
  

  First, assess whether the business's strategy aligns with Kickstart’s objectives. The investment focus includes four key themes:

  • 1.1) The Frictionless Future: Solutions that facilitate seamless offline and online transactions.
  • 1.2) From Automation to Augmentation: Technologies that enhance human capabilities and promote efficiency and workplace satisfaction.
  • 1.3) Smarter Living: Businesses that promote equitable resource distribution, address scarcity while leveraging technology for resource efficiency.
  • 1.4) A World of Plenty: Businesses that promote equitable resource distribution, address scarcity while leveraging technology for resource efficiency.
• Economic Considerations:
  

  Evaluate whether the investment is worth the financial commitment and if the market opportunity is large enough, considering the Total Addressable Market (TAM). Factors such as reputation and team dynamics are essential; a poor reputation may hinder future collaborations. Additionally, timing is critical; an excellent idea may struggle if the market or regulatory landscape is not ready.

• Valuation:
  

  The assessment of a business's value focuses on two main aspects:

  • 3.1) Revenues
    

    Analyze revenue generation capacity across various models (onetime purchases vs. subscription services) and assess pricing strategies relative to perceived customer value.

  • 3.2) Multiple revenues to value equation
    

    Compare revenue generation capabilities with similar businesses in the industry, as having high revenue might still fall short compared to competitors if operational efficiency is lacking.

Principles: ESG in the world of ROI

It is now clear that ESG must be embedded in the DNA of all Kickstarters. A common investment question concerns how businesses will incorporate ESG practices and measure their impacts, particularly focusing on the "G" in Governance. Strong governance frameworks reduce potential risks, as they include policies and regulations that ensure compliance with both domestic and international laws.

Investors should review a business's compliance documents for alignment with these standards. Attention then shifts to the "S" in Social and "E" in Environment, exploring how the business will positively impact society and the environment. However, if prioritization is needed, the emphasis should be on Governance first, followed by Social and Environmental considerations (GSE).

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