Building investor confidence with ESG

As published in PV Magazine in November 2025

Gathering robust environmental, social and governance (ESG) data and using it to implement effective company policy is far more than a box-ticking exercise. Everoze Partner Ellie van der Heijden sees its growing influence as a strategic differentiator for the renewable energy industry. Projects that embed ESG thinking from the outset build investor confidence and navigate regulatory and reputational risks with agility.

It’s tempting to view ESG as a compliance hurdle, something to be managed at the end of a project, dusted off for the annual report or tagged on to the end of a due diligence process. But, in today’s market, ESG is a lens through which investors, regulators, and communities judge the credibility and resilience of a business. When ESG policies are more than just words on paper, when they are lived, measured, and improved, they become a source of competitive advantage.

Strong ESG practices build trust with local communities and regulators, smoothing the path for project approvals and long-term partnerships. In short, ESG is not a side issue. It has become central to business strategy and long-term value creation.

Facing a volley of questions from investors and their ESG advisors can be daunting for small- to medium-sized developers looking to attract investment or raise project finance, if they don’t have an ESG or sustainability department at their disposal.

There are a few key ESG areas where companies can get ahead and be investment ready. By taking care of the essentials and being ready with answers, documentation and evidence, a company can show it is aware of and actively working to manage these issues. This will increase investor confidence in credibility and governance practices, and that’s always a good thing during the transaction process.

Investment ready

Firstly, companies will be asked about their greenhouse gas (GHG) emissions. Monitoring GHG emissions is a starting point, but it’s no longer sufficient to report only on direct emissions. Stakeholders expect a clear view of scope 1 (direct), scope 2 (energy supply), and increasingly scope 3 (entire supply chain) emissions. This means understanding the carbon footprint of supply chain, construction, and even decommissioning. Companies that can provide this data and show year-on-year improvement are better positioned to secure green finance and meet evolving regulatory requirements.

Human rights are another area where expectations are rising. It’s not enough to have a generic statement on the company website. Investors and partners want to see evidence of robust due diligence, mapping of stakeholders and clear grievance mechanisms. For example, is the supply chain audited for forced labour risks? Do policies and procedures cover the salient human rights issues for workers? How effective are grievance mechanisms?

Biodiversity is also rapidly moving up the agenda. Renewable projects, particularly large-scale solar and wind, can have significant impacts on local ecosystems. Forward-thinking companies are not just mitigating harm and complying with regulations, they are looking for ways to enhance biodiversity, by regenerating and connecting habitats or supporting local conservation initiatives. These actions are increasingly recognized by both regulators and investors. Having a biodiversity policy in place and project level biodiversity management plans shows investors that the business is serious about avoiding negative impacts on biodiversity and actively looking for ways to regenerate habitat and enhance ecosystems.

Supply chain risk management is perhaps the most complex challenge. The renewables sector is global, and supply chains can be opaque past the first couple of tiers. Yet, the expectation is clear: companies must know their suppliers, understand ESG risks, and have processes in place to address issues as they arise. This requires a shift from reactive to proactive management anticipating risks before they become crises. Supply chain risks can be multidimensional covering the full range of ESG issues including forced labour, biodiversity, carbon intensity and corruption and unfair competition. Having a robust supplier qualification process that evaluates suppliers across multiple aspects of ESG and goes beyond face value of annual reports and supplier policies, is a great way to show a company is on top of this.

Finally, waste management plans that cover the lifespan of an asset are a must and embedding circularity principles into methods and policies is becoming increasingly important – designing for reuse, repair, and recycling help close material loops, lower costs, and reduce dependency on new resources. Integrating these practices supports compliance with EU sustainability regulations, strengthens ESG performance, and demonstrates commitment to a truly sustainable energy transition.

Companies that can demonstrate good oversight and management in ESG topics will be well placed to show compliance with common sustainability frameworks that investors look to align their decisions with, such as the EU Taxonomy or Equator Principles. ESG is now a dynamic, multi-dimensional challenge. It requires technical expertise, commercial acumen, and a willingness to engage with uncomfortable questions. Those who rise to the challenge will not only meet stakeholder expectations, they will shape them.

Unlocking opportunities

The lesson is clear: ESG is not a “nice to have”, it’s a must-have which, done well, can give companies a competitive edge. If robust ESG policies and data are not in place, it’s increasingly common for investors to require an ESG action plan as a condition of investment. This is not just about avoiding risk, it’s about unlocking opportunity.

Companies that treat ESG as a strategic priority embedding it into decision-making, investing in data and transparency, and engaging with stakeholders will be better positioned to thrive in a rapidly changing market. They will attract investment on good terms, build trust, and create long-term value.

ESG is not a destination but a journey, one requiring continuous improvement, curiosity and a willingness to challenge conventional wisdom. Everoze seeks to bridge the gap between technical, commercial and sustainable solutions to help clients turn ESG from a compliance burden into a new source of competitive advantage.