Lu Jin's first ESG report revealed that ESG has become a "must-do problem" for the head company

ESG is not a multiple-choice question, but a mandatory one.

Text/Daily Earnings Report Baichuan

In recent years, the popularity of ESG (environment, social responsibility, corporate governance) investment has risen sharply and is likely to become a key factor in the development of investment and all companies in the future. Against this backdrop, Luxe & Co., Ltd. (NYSE: LU), which was listed last year, recently released its first ESG report.

Public information shows that Lujin Holdings is the first head enterprise in China's listed financial technology companies in recent years to release a comprehensive system ESG report, which also reflects a trend - whether from the perspective of the global capital market, or the domestic promotion of corporate green finance and social responsibility development momentum, focusing on ESG development has become a "must-do topic" in the development of head enterprises.

Lu Jin Institute, which gradually connotizes ESG

According to the ESG report released by Lujin Holdings, during the reporting period, it has helped more than 1.24 million small and micro enterprises, provided 2.76 million inclusive financial credit services, and provided about 120 million yuan of public welfare loans related to "three rural areas"; its wealth management platform provided online investor education for about 2.9 million people; and its retail credit business, Ping An Inclusive Financial Consumer Literacy Improvement Program "Maintenance C Action", held more than 300 offline activities, popularizing financial knowledge for more than 10 million people.

Not long ago, FTSE Russell, a well-known index compiler under the LSE, announced that Lu jin holdings will be included in two major ESG thematic indices - the FTSE Emerging Markets ESG Low Carbon Select Index and the FTSE Asia (excluding Japan) ESG Low Carbon Select Index. This is also the second time that Lujin Holdings has been selected into the international mainstream index since IT WAS INCLUDED IN THE CHINA OVERSEAS STOCK STANDARD INDEX AND THE CHINA OVERSEAS LARGE CAP INDEX ON THE LISTING DAY LAST YEAR.

For the company's current new business composition and business model, Zheng Xigui, chief financial officer of Lujin Holdings, said, "The company's current business model is echoing with ESG, first of all, in the "G" part, what we have to do is to adhere to legal and compliant operations now and in the future, implement regulatory requirements, and improve the overall governance level of the company." ”

According to its latest financial report, as of the end of the second quarter of 2021, the proportion of P2P historical business of Lujin Institute was 0, basically achieving zero. This marks that Lujin, which once had P20 billion yuan in P20 stock assets, has achieved a smooth exit from P2P business.

For the "S" part of the ESG, Zheng Xigui believes that "89% of small and micro business owners have credit cards, with an average credit line of 150,000 yuan, only 29% have bank operating loans, of which nearly 30% can get money, and 37% have bank consumer loans, with an average borrowing amount of 390,000 yuan." In this context, we are a useful complement to existing financial institutions. ”

It is understood that Lujin has specially designed products with fast response speed and loan cycle of 2-3 years for small and micro business owners. In 2020, Lujin Holdings has helped more than 1.24 million small and micro enterprises, inclusive financial credit services have reached 2.76 million people, and the data shows that in the past five years, Lujin Holdings has accumulated nearly 2.3 trillion yuan in loans, and 77.6% of the new loans in the second quarter of this year flowed to small and micro enterprises, an increase of 5 percentage points over the same period last year, effectively supporting the development of the real economy.

In addition, Lu Jin has also actively carried out a series of activities in terms of green finance practice, actively responded to the call for a low-carbon economy, and vigorously supported the development of green finance projects through relevant fundraising, such as the introduction of related industrial capital such as environmental protection, emission reduction, and cultural development, and effectively supported industries such as sewage treatment, urban greening, new energy, tourism and cultural creation that conform to the connotation of ESG.

ESG is no longer a multiple-choice question, but a mandatory one

ESG investment originated from socially responsible investment in Europe and the United States in the 1970s and 1980s, and after experiencing continuous development and evolution, it was officially proposed by the United Nations in 2004, and has been developed for less than 20 years. As a measure of corporate sustainability, ESG has become a key word in the capital market in the context of the epidemic and carbon neutrality.

Ten years ago, the ESG investment market was dominated by professional investors, with assets under management not exceeding $5 billion, but now ESG investment is favored, and there are forecasts that global ESG assets are expected to grow to $53 trillion by 2025, and more and more corporate and institutional customers are beginning to pay attention to and implement their ESG goals.

As far as the domestic market and enterprises are concerned, the previous investment in this area is not the mainstream, but from the perspective of data and dynamics in all aspects, the current ESG is already on the road.

The data shows that the ESG products issued by various asset management institutions have surged significantly this year. According to Wind statistics, only 3 public funds in the name of ESG were issued in China last year, and in the first half of this year, this number increased to 8. In addition, according to Securities Daily, the scale of related products issued by domestic commercial banks this year has reached nearly 10 billion yuan.

The widening of the talent gap also confirms this established fact from the side, according to the Shanghai Securities News, a number of foreign-funded institutions are vigorously recruiting research talents in ESG investment.

In June this year, All Things Xinsheng (Love Recycling) successfully listed in the United States with the gimmick of "the first chinese stock ESG". In its 2021 fiscal year annual report, Ali set "carbon reduction", "rural revitalization" and "employment promotion" as keywords. Tencent also wrote in its 2020 results report: "Sustainability is critical to the company's strategic and operational development, and we have always integrated social responsibility into the company's products and services. ”

"ESG should not be limited to an event, let alone shouting a slogan. All enterprises should implement to the action level, must be combined with the ESG concept at the business model level, pay attention to regulatory compliance to improve the overall governance level, and constantly explore ways to achieve 'green', raise 'temperature', improve the level of scientific and technological innovation to support the development of green and low-carbon economy, and strive to contribute more to environmental protection. Zheng Xigui said.

Analysts believe that in the future, with the implementation of China's dual-carbon strategy and the continuous improvement of the ESG ecosystem, ESG investment will surely usher in explosive growth in China. This will be a historic opportunity for enterprises practicing ESG to reshape their core competitiveness and lay an advantageous foundation for their long-term sustainable development. (Produced by per cai net)