ESG Substance vs ESG Marketing

Few terms have been stretched as far in recent years as ESG. Almost every project we see now arrives with an ESG section in its pitch material. Very few of those sections survive a direct question about what, specifically, has been done differently because of it.

Genuine ESG substance in a real-asset project tends to be unglamorous and specific: a land deal that has genuinely engaged and fairly compensated affected communities, not just consulted them on paper. A mining project with a credible, costed rehabilitation plan, not a one-line commitment to 'responsible closure'. An energy project that has measured and can demonstrate its emissions profile against a clear baseline, rather than asserting it is 'green' because the word appears in its name.

The test we apply when screening an opportunity is simple: does the ESG claim change a number anywhere in the project's costs, risks or timeline? If a community engagement process has a budget, a timeline and a named person responsible for it, that is substance. If it exists only as a paragraph in the IM, that is marketing.

This matters to funders for reasons beyond reputation. Projects with genuine ESG substance tend to have fewer late-stage surprises — fewer community disputes, fewer regulatory delays, fewer rehabilitation liabilities that show up unbudgeted years later. ESG done properly is, in the end, simply another form of risk management. Treating it as anything less is a disservice to the project and to the capital behind it.