Journal of Applied Finance & Banking

ESG Integration into Venture Capital in the UK

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  • Abstract

     

    Although ESG (Environmental, Social, and Governance) research on companies and investment portfolios is widespread, most of data and research is from established companies, driven by the increasing societal emphasis on sustainability and adherence to evolving compliance standards. However, there is a lack of ESG-focused studies on early-stage and venture capital. This study seeks to fill the gap in research on the ESG maturity of start-ups by surveying 225 start-ups in the portfolio of a UK-based venture capital, thereby providing a unique insight into the overall awareness of ESG among start-ups by presenting genuine samples. The findings provide implementation advice on optimal approaches to incorporate ESG issues into venture capital, and improve and leverage the dynamic between venture capital and start-ups to influence start-ups to adopt and comply with ESG integration.


    JEL classification numbers: C42, G11, G24, G38, M14.

    Keywords: ESG, Venture capital, Start-up, United Kingdom.