Impact of ESG on M&A Success
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How should environmental, social, and governance (ESG) factors influence the decision-making process in M&A, and can ESG considerations lead to more sustainable, long-term value creation in deals?
An emphasis on ESG considerations can help companies align with growing regulatory and societal demands, and enhance brand reputation, employee satisfaction, and customer loyalty. However, it’s important to avoid “greenwashing”. For example, a merger driven solely by the desire to tap into environmental benefits such as carbon credits without genuine commitment to sustainability fails to deliver lasting value. On the other hand, when companies merge with a shared commitment to ethical business practices, transparency, and long-term environmental stewardship, they can create significant value through cost savings, innovation, and stronger stakeholder trust.
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