ESG-the agenda of the regions of Russia
Research Summary
September 2023
Although most regions do not yet have a key document defining long-term sustainable development goals - an ESG-transformation strategy - the involvement of the subjects in the agenda, as the research shows, is higher than one might assume at first glance. From region to region, a whole range of measures are being taken to preserve the environment and reduce anthropogenic impact, ensure inclusive social practices and improve the quality of public administration.
Investments in RES generation, creation of zero-emission zones and carbon polygons, grants and favourable taxation for social entrepreneurs - we would like to introduce you to these and many other regional ESG initiatives in our study. This study analyses ESG initiatives in Russian regions. The main focus is on assessing the effectiveness of regional projects related to improving the environmental situation, social protection of the population and the introduction of innovative technologies in public and corporate governance. The study of approaches to human capital development, digitalisation and support for SMEs is of particular importance. The selection of regions for this study was based on their positions in the cumulative ESG rating of the RAEX agency for the period from 2019 to 2021. The main selection criteria were sustainable positive changes in these regions during this period, as well as significant projects within the framework of national programmes. The regions with high subsidy dependence were excluded from the analysis, which allowed us to focus on those subjects that demonstrate active independent development within the framework of ESG initiatives.
The Leningrad Region stands out for actively attracting investment and facilitating interaction with business. The region has managed to attract investments worth RUB 4 trln thanks to the creation of a simplified system for investors. In the area of human capital development, the region supports entrepreneurial and social initiatives of small and medium-sized enterprises (SMEs) and nonprofit organisations (NPOs). The regional government has set an ambitious goal of increasing the number of SMEs to 270,000 by 2030, which will help stimulate economic growth and improve social conditions.
However, the region lacks long-term ESG strategies and goals, which limits a systemic approach to sustainable development.
Innovation is also in focus: the region plans to conduct a significant amount of fundamental research to support technological progress and the development of new areas.
However, there are also challenges, namely the lack of a detailed long-term strategy implementation plan and the shortage of specific ESG initiatives and key performance indicators.
In environmental development, the region focuses on the rational use of natural resources and the creation of natural sites for carbon sequestration. These measures will help preserve natural ecosystems and contribute to reducing carbon footprints.
In human capital development, the region aims to create modern and competitive higher education that will meet global standards. In addition, emphasis is placed on creating an infrastructure that promotes openness and accessibility of education for all.
In the area of digitalisation, the Tver Region is actively introducing innovative technologies in governance, which should improve the efficiency and modernity of regional process management.
Nevertheless, among the weaknesses are those previously noted in other regions - the lack of a clear ESG strategy and specific ESG targets, as well as the absence of key performance indicators for the executive branch.
In environmental development, the region is actively engaged in environmental monitoring and promotion of environmental education and upbringing. These measures are aimed at protecting the environment and raising environmental awareness among the population.
In the area of human capital development, the region focuses on the continuous development of human potential and systematic support for socially disadvantaged people. Slowing down the population decline is also an important goal, which should contribute to improving the demographic situation.
Digitalisation is becoming an important area of focus, including the creation of a convenient transport infrastructure and the digitalisation of socially important services and facilities. These initiatives will help improve the quality of life and increase accessibility of services for the citizens.
The region's weakness, like others, is the lack of a clear ESG strategy, ESG targets and key performance indicators for the executive branch.
The region's focus in environmental development is on shaping environmental conditions that foster a healthy population. This includes creating and maintaining a favourable ecological environment, which directly affects the citizens' quality of life.
The region seeks to create conditions for the development of personal potential and self-actualisation in the development of human capital. The main focus is on the training of IT personnel and environmental education, which will help the citizens to unlock their potential and contribute to the development of the region.
Digitalisation of the economy in the Ryazan region includes the creation of innovative high-productive jobs and the formation of conditions for the development of digital entrepreneurship. These steps are aimed at supporting new technologies and businesses, which contributes to the modernisation of the economy.
The weakness of the region lies in the lack of regional initiatives related to social factors outside the national projects.
In protecting and developing natural sites, the region focuses on maintaining and developing the region's ecological framework, including the system of specially protected natural areas (SPNAs). These measures are aimed at preserving natural resources and supporting ecosystems.
The region aims to improve living standards and create favourable conditions for the creative self-actualisation of its residents in the development of human capital. These initiatives will help improve the quality of life and support the personal development of the citizens.
Digitalisation and support for civil structures are important areas, including increasing the production of knowledge-intensive and information services. These steps are aimed at modernising the economy and improving the availability of high-tech services.
The region's weakness is the lack of regional initiatives related to environmental (E) factors outside the national projects.
The region is setting ambitious goals in environmental development. By 2050, it is planned that the share of renewable energy sources (RES) will be approximately 13%. The region is also developing systems for utilising secondary resources, which will help to reduce environmental impact and improve resource management.
In supporting socially oriented NPOs, the region aims to increase the reach of the organisations under its umbrella by 1.5 times by 2030. This initiative is aimed at expanding social support and helping vulnerable groups.
The Saratov Region is working on the digitalisation of the economy to ensure efficient budget spending and openness and transparency in the activities of government agencies. These measures will help improve manageability and trust in government structures.
The region's weakness lies in the lack of regional initiatives related to social factors outside the national projects.
To reduce its carbon footprint, the region aims to reduce the negative environmental impact of energy infrastructure by at least 20% by 2025. These measures will help to improve the ecological situation and support sustainable development.
When it comes to human capital development, the region aims to improve the well-being of the population and ensure that the continuing care needs of the elderly are fully met by 2030. These steps are aimed at improving the quality of life and supporting vulnerable groups.
The Penza Region's focus in the digitalisation of the economy is on fighting corruption in state and municipal institutions. This should help to increase transparency and efficiency in the work of state agencies.
The region's weaknesses lie in the lack of regional initiatives related to environmental (E) and governance (G) factors outside the national projects.
When it comes to natural resources and sustainable development, the region has set goals to preserve unique natural sites and ensure the environmental safety of the population. These initiatives aim to protect natural heritage and create a safe ecological environment.
The Republic of Adygea expands the range of services provided by socially oriented NPOs and supports innovative social projects to develop human capital. This helps to improve support and services for vulnerable groups.
Digitalisation of public services involves introducing innovations into the public administration system to improve the accessibility and quality of public services. These measures help to improve the interaction of citizens with state structures.
The region's weaknesses include few regional initiatives related to environmental factors outside of the national projects, as well as the lack of a clear ESG strategy, ESG targets and key performance indicators for the executive branch.
Investments in RES generation, creation of zero-emission zones and carbon polygons, grants and favourable taxation for social entrepreneurs - we would like to introduce you to these and many other regional ESG initiatives in our study. This study analyses ESG initiatives in Russian regions. The main focus is on assessing the effectiveness of regional projects related to improving the environmental situation, social protection of the population and the introduction of innovative technologies in public and corporate governance. The study of approaches to human capital development, digitalisation and support for SMEs is of particular importance. The selection of regions for this study was based on their positions in the cumulative ESG rating of the RAEX agency for the period from 2019 to 2021. The main selection criteria were sustainable positive changes in these regions during this period, as well as significant projects within the framework of national programmes. The regions with high subsidy dependence were excluded from the analysis, which allowed us to focus on those subjects that demonstrate active independent development within the framework of ESG initiatives.
1. Leningrad Region
The Leningrad Region is working hard to create zero-emission zones and develop tourist routes in natural areas. These measures contribute not only to improving the environmental situation, but also to developing the region's tourism potential.The Leningrad Region stands out for actively attracting investment and facilitating interaction with business. The region has managed to attract investments worth RUB 4 trln thanks to the creation of a simplified system for investors. In the area of human capital development, the region supports entrepreneurial and social initiatives of small and medium-sized enterprises (SMEs) and nonprofit organisations (NPOs). The regional government has set an ambitious goal of increasing the number of SMEs to 270,000 by 2030, which will help stimulate economic growth and improve social conditions.
However, the region lacks long-term ESG strategies and goals, which limits a systemic approach to sustainable development.
2. Tyumen Region
The Tyumen Region is actively working on rational environmental management, aiming to significantly improve the environmental situation. The region's key objectives include:- Increasing the share of utilised production waste to 90% by 2030, which will significantly reduce the amount of waste sent to landfills.
- Reducing energy consumption from non-renewable sources through the introduction of green technologies, which helps to reduce the carbon footprint and switch to more sustainable energy sources.
- In the area of human capital development, the Tyumen Region focuses on expanding social support for elderly and disabled citizens. Both government agencies and nonprofit organisations are actively involved in this process.
- In addition, the region is actively developing the sphere of science and innovation as well as information technologies, which creates the basis for technological progress and investment attraction.
3. Sverdlovsk Region
The Sverdlovsk Region is actively working to improve the environmental situation and develop human capital. The region is making efforts to ensure the availability of sustainable energy sources, which should make the energy sector more reliable and economical. In terms of social development, the region aims to promote healthy lifestyles and increase the number of people employed in small and medium-sized businesses, which should contribute to economic growth and improve the quality of life of the locals.Innovation is also in focus: the region plans to conduct a significant amount of fundamental research to support technological progress and the development of new areas.
However, there are also challenges, namely the lack of a detailed long-term strategy implementation plan and the shortage of specific ESG initiatives and key performance indicators.
4. Tver Region
The Tver Region invests in carbon capture projects and actively develops the IT sector through subsidies and educational programmes.In environmental development, the region focuses on the rational use of natural resources and the creation of natural sites for carbon sequestration. These measures will help preserve natural ecosystems and contribute to reducing carbon footprints.
In human capital development, the region aims to create modern and competitive higher education that will meet global standards. In addition, emphasis is placed on creating an infrastructure that promotes openness and accessibility of education for all.
In the area of digitalisation, the Tver Region is actively introducing innovative technologies in governance, which should improve the efficiency and modernity of regional process management.
Nevertheless, among the weaknesses are those previously noted in other regions - the lack of a clear ESG strategy and specific ESG targets, as well as the absence of key performance indicators for the executive branch.
5. Ulyanovsk region
The Ulyanovsk region focuses on forest protection, social projects and digitalisation of key areas such as transport and medicine.In environmental development, the region is actively engaged in environmental monitoring and promotion of environmental education and upbringing. These measures are aimed at protecting the environment and raising environmental awareness among the population.
In the area of human capital development, the region focuses on the continuous development of human potential and systematic support for socially disadvantaged people. Slowing down the population decline is also an important goal, which should contribute to improving the demographic situation.
Digitalisation is becoming an important area of focus, including the creation of a convenient transport infrastructure and the digitalisation of socially important services and facilities. These initiatives will help improve the quality of life and increase accessibility of services for the citizens.
The region's weakness, like others, is the lack of a clear ESG strategy, ESG targets and key performance indicators for the executive branch.
6. . Ryazan region
The Ryazan region focuses on investment in education and development in both environmental and IT spheres, striving for sustainability and innovation.The region's focus in environmental development is on shaping environmental conditions that foster a healthy population. This includes creating and maintaining a favourable ecological environment, which directly affects the citizens' quality of life.
The region seeks to create conditions for the development of personal potential and self-actualisation in the development of human capital. The main focus is on the training of IT personnel and environmental education, which will help the citizens to unlock their potential and contribute to the development of the region.
Digitalisation of the economy in the Ryazan region includes the creation of innovative high-productive jobs and the formation of conditions for the development of digital entrepreneurship. These steps are aimed at supporting new technologies and businesses, which contributes to the modernisation of the economy.
The weakness of the region lies in the lack of regional initiatives related to social factors outside the national projects.
7. Tula Region
The Tula Region is actively working on environmental and social improvements, as well as developing digitalisation and support for civic structures.In protecting and developing natural sites, the region focuses on maintaining and developing the region's ecological framework, including the system of specially protected natural areas (SPNAs). These measures are aimed at preserving natural resources and supporting ecosystems.
The region aims to improve living standards and create favourable conditions for the creative self-actualisation of its residents in the development of human capital. These initiatives will help improve the quality of life and support the personal development of the citizens.
Digitalisation and support for civil structures are important areas, including increasing the production of knowledge-intensive and information services. These steps are aimed at modernising the economy and improving the availability of high-tech services.
The region's weakness is the lack of regional initiatives related to environmental (E) factors outside the national projects.
8. Saratov Region
The Saratov Region is actively investing in environmental and social initiatives, as well as developing the digitalisation of the economy.The region is setting ambitious goals in environmental development. By 2050, it is planned that the share of renewable energy sources (RES) will be approximately 13%. The region is also developing systems for utilising secondary resources, which will help to reduce environmental impact and improve resource management.
In supporting socially oriented NPOs, the region aims to increase the reach of the organisations under its umbrella by 1.5 times by 2030. This initiative is aimed at expanding social support and helping vulnerable groups.
The Saratov Region is working on the digitalisation of the economy to ensure efficient budget spending and openness and transparency in the activities of government agencies. These measures will help improve manageability and trust in government structures.
The region's weakness lies in the lack of regional initiatives related to social factors outside the national projects.
9. Penza Region
The Penza Region focuses on social initiatives and actively invests in supporting disadvantaged citizens, along with efforts to reduce its carbon footprint and digitalise the economy.To reduce its carbon footprint, the region aims to reduce the negative environmental impact of energy infrastructure by at least 20% by 2025. These measures will help to improve the ecological situation and support sustainable development.
When it comes to human capital development, the region aims to improve the well-being of the population and ensure that the continuing care needs of the elderly are fully met by 2030. These steps are aimed at improving the quality of life and supporting vulnerable groups.
The Penza Region's focus in the digitalisation of the economy is on fighting corruption in state and municipal institutions. This should help to increase transparency and efficiency in the work of state agencies.
The region's weaknesses lie in the lack of regional initiatives related to environmental (E) and governance (G) factors outside the national projects.
10. Republic of Adygea
The Republic of Adygea has a strong focus on socially oriented initiatives and sustainable development, with special attention to the inclusion of children and elderly citizens.When it comes to natural resources and sustainable development, the region has set goals to preserve unique natural sites and ensure the environmental safety of the population. These initiatives aim to protect natural heritage and create a safe ecological environment.
The Republic of Adygea expands the range of services provided by socially oriented NPOs and supports innovative social projects to develop human capital. This helps to improve support and services for vulnerable groups.
Digitalisation of public services involves introducing innovations into the public administration system to improve the accessibility and quality of public services. These measures help to improve the interaction of citizens with state structures.
The region's weaknesses include few regional initiatives related to environmental factors outside of the national projects, as well as the lack of a clear ESG strategy, ESG targets and key performance indicators for the executive branch.
Conclusion
To summarise, each region implements meaningful environmental initiatives such as educational eco-activities, greening, and waste management. Social projects in the regions focus on supporting people with disabilities, elderly citizens, NPOs and social entrepreneurs. Digitalisation of public services is also an important area where regions are actively introducing new technologies and improving investor relations.
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