ESG Case Study: Funding Circle
ESG Initiatives and Areas for Improvement
Summary
Funding Circle Overview
Funding Circle is one of the largest providers of government-backed loads, including those offered through the Growth Guarantee Scheme. Rise IQ was selected to assist Funding Circle in developing a customised sustainability strategy. This involved a thorough materiality assessment that covered the key ESG factors that impacted business operations, stakeholder expectations and long-term sustainability goals.
This case study highlights how Rise IQ was able to assess and positively influence ESG outcomes. Let’s start with the result!
Achievements and Impacts
- A comprehensive materiality assessment enabled the identification and prioritisation of critical ESG issues.
- This strategic focus on high-impact areas such as carbon management, data security and ethical practices significantly enhanced their sustainability performance and stakeholder trust.
- Continuous engagement and transparent reporting are essential in reinforcing their commitment to ESG principles.
- By concentrating on community engagement, risk mitigation and capturing new opportunities, Funding Circle can enhance its positive impact and ensure sustainable growth.
- These steps align with both investor expectations and regulatory requirements, positioning Funding Circle as a leader in responsible business practices.
Rise IQ Recommendations: Aims, Actions & Impacts
Our approach at Rise IQ was to begin with a thorough assessment of the current situation. This enabled us to identify four strategic priority areas. We then went on to make detailed recommendations as to how these priorities could be underpinned by robust governance.
Carbon Management Recommendation
We advised Funding Circle to establish a comprehensive baseline of their emissions footprint.
This was achieved by adopting a systematic approach to measure emissions across all three scopes (as defined by the Greenhouse Gas (GHG) Protocol.) This detailed strategy aims to accurately quantify a business’s overall environmental impact.
Community Impact and Engagement Recommendation
Based on our assessment, we also proposed actionable steps for them to maximize their positive impact within the community. This included increasing employee engagement in community service projects and other philanthropic activities.
An example of this is their partnership with Earthwatch to create urban green spaces. Funding Circle planted a total of 1,200 trees, which successfully established two Tiny Forests in Peckham Rye Park & Common.
Regulatory Preparedness
We prepared Funding Circle for the upcoming UK introduction of ISSB/IFRS S1 and S2 standards by setting a selection of science-based targets.
This ensured that their ESG strategy aligned with evolving regulatory requirements.
Risk Mitigation and Opportunity Capture
We identified the next steps that Funding Circle might potentially need to take mitigate risks and seize new opportunities. This included actively supporting a range of SMEs to contribute to a more resilient and sustainable economy.
Community and Stakeholder Engagement
By focusing on community engagement, Funding Circle can significantly enhance its positive impact. Initiatives such as supporting SMEs and engaging in urban greening projects not only contribute to the community, they also align with investor expectations and regulatory requirements.
Financial Inclusion
Funding Circle offers financial products designed to cater to populations who are historically underserved. These include women, minorities, and low-income individuals.
These microfinance offerings provide financial services to economically disadvantaged individuals and small businesses with poor (or non-existent) credit records.
In addition, Funding Circle’s peer-to-peer lending platform connects small and medium-sized businesses with investors. This facilitates access to funding that is essential for business growth and sustainability.
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