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In the global focus on ESG, the crucial role of Small and Medium-sized Enterprises (SMEs) is often overshadowed by large corporations . Despite this, SMEs represent over  90% of businesses globally , making their collective potential for societal and environmental impact immense -"the whole is greater than the sum of its parts." Key Role and Characteristics of SMEs In Israel, SMEs are particularly vital , accounting for 99.5% of businesses and contributing 54% of private sector GDP. These companies are characterized by flat organizational structures, high flexibility, and a founding motivation often driven by inherent values to address market and social gaps. They possess a natural inclination towards "doing good," which forms part of their organizational DNA. Bridging the Knowledge Gap The main obstacle for SMEs in maximizing their impact is the lack of awareness, knowledge, and accessibility to structured processes for responsible management and measuring impact. This leads to valuable, values-driven actions being treated as hidden philanthropy rather than being strategically connected to the core business and communicated externally. To realize their full potential, SMEs need to embrace a clear, business-focused impact language, start with small, measurable actions, and be supported by collaboration and knowledge sharing from larger corporations. Adopting an impact strategy is not optional; it is essential for their growth and for promoting a sustainable society. Michal Tamam , Consultant, Lecturer, and Project & Community Manager specializing in Growth, Innovation with Social Impact, and Cross-Sectoral Collaboration.

In contrast to the growing politicization of ESG in the United States, the United Kingdom is taking a bold regulatory step. In July 2025, the Financial Conduct Authority (FCA) introduced a reform that transforms climate reporting from a voluntary practice into a mandatory requirement for any company seeking to list on the London Stock Exchange. Starting January 2026, companies will need to disclose concrete climate risks, realistic transition plans, and board-level oversight mechanisms—shifting the market toward greater transparency and accountability. The reform comes at a strategic moment. London has faced declining IPO activity in recent years, with companies migrating to New York and Amsterdam due to valuation gaps and liquidity concerns. Rather than lowering standards, the UK is positioning itself as a leader in responsible finance: fewer bureaucratic burdens, but more meaningful information that investors can trust. Under the new rules, companies must identify material climate-related risks such as exposure to extreme weather, dependence on fossil-based technologies, and vulnerabilities within supply chains. They must also present detailed transition plans with measurable targets, timelines, cost estimates, and contingency strategies. The FCA places significant emphasis on governance, requiring boards to demonstrate expertise, accountability, and integration of climate considerations into strategic decision-making. A core aim of the reform is curbing greenwashing. By standardizing disclosures and demanding concrete data rather than vague commitments, the FCA seeks to provide investors with clearer insight into long-term risks and opportunities. This also empowers smaller investors, who will now be able to compare companies more easily without relying on costly analysis. The UK’s approach reflects a broader shift: treating environmental and social considerations as interconnected. Companies must account not only for emissions and energy use, but also for how their transition strategies affect workers, local communities, and economic resilience. This aligns with emerging global thinking around climate justice. There are several reasons to believe the reform will succeed. Public demand for sustainable products and responsible corporate behavior is rising sharply in the UK. Technological tools—from satellite data to independent databases like CDP—make it harder for companies to obscure environmental impacts. And as more companies adopt transparent practices, market expectations will evolve, rewarding those that lead in credible sustainability performance. Seen globally, the UK is charting a middle path: less complex than the European Union’s extensive regulatory framework, yet more ambitious and mandatory than the US’s increasingly polarized approach. By betting on clarity and comparability, London aims to strengthen its competitiveness and redefine ESG reporting standards worldwide. To read the full article, visit our website in Hebrew.

Human-driven activity since the mid-18th century has accelerated environmental change, increasing greenhouse gas concentrations and intensifying global warming. Israel is identified as a climate “hotspot,” expected to face more extreme heat, reduced winter precipitation of up to 22%, and greater variability in heavy-rain events. With rapid population growth and high urban concentration along the vulnerable coastline, the country faces heightened exposure to sea-level rise and coastal erosion, while sparsely populated northern and southern regions present opportunities for peripheral development in sectors such as agri-tech, desert-tech, energy, and water. Climate impacts carry significant economic consequences, including losses in productivity, infrastructure damage, supply chain disruptions, and global value-chain pressures. International estimates place annual global natural-disaster damages at roughly 170 billion USD, and Israeli studies suggest potential GDP declines of up to 27.5%, with major projected costs in water, flooding, and agriculture. The United States and Europe have introduced a range of carbon-reduction tools, including carbon taxes, fuel taxes, and cap-and-trade systems, all contributing to a growing carbon-pricing market. The EU’s Carbon Border Adjustment Mechanism (CBAM), launched in 2023, aims to prevent carbon leakage by aligning the carbon cost of imported goods with EU standards. Additional policy measures - such as the U.S. Inflation Reduction Act and EU research and mitigation programs, provide fiscal and monetary incentives to support adaptation and decarbonization. Global climate governance frameworks, including the IPCC, the Rio Convention, the Kyoto Protocol, and the Paris Agreement, guide national policy. Israel participates actively in these frameworks and has adopted government decisions to advance renewable energy, reduce emissions, implement carbon pricing, promote green construction, support energy efficiency, expand solar and agri-voltaic infrastructure, and strengthen national climate adaptation and coordination mechanisms. The Ministry of Economy and Industry’s Climate Plan, budgeted at 1.4 billion NIS, with additional initiatives under development, aims to bolster economic resilience, reduce industrial carbon footprints, and support growth in emerging climate-related sectors. The plan is structured around four pillars: climate adaptation (including resilient industrial zones and worker safety), mitigation (such as carbon pricing implementation and circular-economy measures), climate-driven growth engines (energy, desert agriculture, hydrogen, carbon capture, and food-tech), and long-term strategic planning based on dynamic techno-economic modeling and supply-chain analysis. Overall, Israel’s climate strategy rests on integrating environmental and economic considerations, leveraging global experience, and strengthening national capabilities. Embedding the plan within ministerial operations is intended to keep it adaptive and model-driven, while innovation and market analysis are positioned as key drivers of national resilience and competitiveness under changing climate conditions. To read the full article, visit our website in Hebrew.

Over the past two decades, Environmental, Social, and Governance (ESG) principles have become central to corporate strategy and investment priorities worldwide. Yet, recent years have seen growing criticism—especially from within the business and financial sectors—regarding inconsistent standards, measurement difficulties, and the tension between ESG commitments and financial performance. Global shifts in late 2024 and early 2025, including the return of the Trump administration and its deregulatory, anti-ESG stance, have deepened uncertainty. Meanwhile, in Europe, the EU Omnibus Package  has raised questions about the scope and timing of sustainability reporting obligations. Despite political polarization, evidence shows that ESG is not declining but evolving. Many companies continue to integrate ESG principles into management systems, sometimes under different names, using them as tools for risk management, governance improvement, and long-term value creation. Even institutions withdrawing from climate alliances such as GFANZ continue implementing climate-related risk models and resilience strategies. Financial actors like Norges Bank Investment Management  have adopted AI-based sustainability assessments across vast portfolios, highlighting a shift toward operational integration. Academic and professional surveys—such as those by Harvard Law School’s Forum on Corporate Governance  and EY’s Europe Long-Term Value  study—show that executives still view ESG as a strategic driver of competitiveness and long-term stability rather than a mere compliance requirement. The EU Omnibus Package , far from signaling regulatory retreat, aims to streamline ESG frameworks and clarify legal obligations under directives like the CSRD and CSDDD. Companies such as Schneider Electric view these adjustments as opportunities to enhance consistency and investor trust. Ultimately, ESG is undergoing a process of maturation and institutionalization. While its terminology may evolve, its substance is becoming an inseparable component of modern corporate governance—essential for managing environmental, social, and financial risks in an increasingly volatile world. To read the full article, visit our Hebrew main blog.

Since 2023, the rise of artificial intelligence has been reshaping economies, labor markets, and social systems worldwide. While AI enables new professions, knowledge accessibility, and technological solutions to social issues, it also disrupts employment stability, pension savings, and long-term financial security. In Israel, these transformations intersect with demographic changes that challenge the traditional pension structure, once based on a stable generational pyramid. The shift toward flexible and temporary employment undermines predictable income patterns and long-term planning. To ensure social resilience, Israel must redesign its employment, education, and pension systems to adapt to a rapidly evolving technological landscape. Responding to future challenges requires a transformation in how societies manage human capital and intergenerational wealth. Education and professional training must evolve toward lifelong learning accessible to all citizens, with emphasis on digital literacy, creativity, empathy, and leadership. Economically, a modular pension savings model starting from birth—supported by the state, families, and society—could provide every citizen with continuous, independent pension growth. At the same time, aligning pension investments with the UN Sustainable Development Goals (SDGs) would turn these funds into strategic instruments for sustainable growth. Global examples such as Norway’s sovereign wealth fund and Canada’s CPP Investments demonstrate that ESG-aligned portfolios can generate both long-term returns and social impact. In its early decades, Israel effectively used pension and national insurance funds to finance national development through long-term, guaranteed bonds. Reapplying this model—this time toward sustainable infrastructure and SDG-driven investment—could make Israel a world leader in adaptive, forward-looking policy. Despite gaps in national coordination and declining climate-tech investment, Israel’s small scale, technological ecosystem, and innovative culture position it to lead by example. The central question is not technological but ethical and managerial: whether the state will cling to outdated mechanisms or embrace transformative ones suited for the AI era. By linking pension systems with sustainable development, Israel can pioneer a model of long-term economic resilience and intergenerational stability. To read the full article, visit our Hebrew main blog.

The past decade has marked a turning point in recognizing the financial implications of the climate crisis. As climate-related risks increasingly affect global markets, regulators worldwide are integrating environmental and climate considerations into the financial system. The Basel Committee on Banking Supervision (BCBS) set this trend in motion with its 2022 principles on climate-related financial risks. In Israel, this movement is culminating in the forthcoming Proper Conduct of Banking Business Directive No. 345 , which will take effect in June 2026 , requiring banks to systematically identify, assess, and manage climate-related risks within their credit portfolios. Directive 345 introduces a paradigm shift: banks must now consider environmental exposure as a core financial risk factor, on par with credit or liquidity risks. Institutions will evaluate their corporate clients through new climate questionnaires, scenario analyses, and advanced statistical models that quantify vulnerabilities to physical, regulatory, and transitional climate risks. Companies that fail to provide adequate climate data or demonstrate sound sustainability practices may face stricter lending terms, higher collateral requirements, or even credit denial, while firms with proactive sustainability strategies will benefit from better financing conditions and stronger investor trust. For the business sector, the directive signifies a fundamental transformation in credit access. Climate readiness will become a decisive factor for financing and competitiveness. Firms across high-risk industries—such as agriculture, real estate, energy-intensive manufacturing, and logistics—must now adopt structured climate-risk management processes, reduce emissions, and enhance transparency through standardized ESG reporting. Early adaptation will not only ensure regulatory compliance but also create a strategic advantage in a rapidly evolving global economy where climate resilience and environmental governance define long-term financial stability. To read the full article, visit our Hebrew main blog.

The concept of stewardship  has emerged in recent decades as a critical pillar for reshaping the relationship between investors, corporations, and society. More than simply maximizing returns, stewardship emphasizes a long-term responsibility to safeguard both financial and social value. This article traces the origins of the stewardship idea, outlines its institutionalization in the global Stewardship Code  frameworks, and highlights its growing connection to the ESG movement. Dr. Benny Furst shows how these ideas have gradually spread worldwide, including the development of an international stewardship network that links regulators, institutional investors, and civil society actors. Finally, the article reflects on the challenges and opportunities of embedding stewardship principles into the Israeli market. It raises important questions about how such frameworks can be adapted locally to promote sustainable governance and ensure that financial power is used responsibly. To read the full article, visit our Hebrew main blog.

This post challenges the long-standing belief that investors care only about financial returns. For decades, capital markets were guided by the doctrine of shareholder value maximization, assuming that profit was the sole objective of anyone holding equity. Yet changing societal expectations – particularly among younger generations – reveal a different reality: many investors want their money to reflect their values, not just generate income. Building on the framework proposed by economists Oliver Hart and Luigi Zingales, the post argues for a shift from maximizing shareholder value to maximizing shareholder welfare, meaning that ethical and social preferences should be considered alongside financial ones. Despite this shift in mindset, most investors are still unable to act on their convictions. Proxy voting remains concentrated in the hands of institutional intermediaries such as pension funds and asset managers, who continue to vote primarily on the basis of returns. To close this gap, new models are emerging across global markets. Direct voting programs give individuals control over how their shares are voted. Value-based voting policies allow investors to choose predefined proxy strategies that reflect their priorities. Mission-driven funds align both capital allocation and voting behavior with stated values. These innovations redefine money not just as capital but as a form of democratic expression – a way to vote through investment. This is not a rejection of profit. It is an expansion of investor freedom, turning sustainability into a matter of choice rather than constraint. To read the full article, visit our Hebrew main blog

This post explores FoodTech as a critical intersection of food and innovation—responding to growing environmental, social, and regulatory pressures. Traditional food systems, especially those based on animal products, are no longer sustainable. In contrast, FoodTech offers scalable solutions that integrate ESG values into core product and infrastructure design.   The discussion highlights emerging technologies such as alternative proteins, vertical farming, and smart supply chain tools. These innovations reduce greenhouse gas emissions, resource usage, and food waste—yet their success depends not only on technological advancement but also on cultural acceptance, investor confidence, and clear regulatory pathways.   The post stresses the market's transition from hype-driven investment to "smart money" that prioritizes B2B infrastructure solutions. At the same time, regulatory clarity and public trust are essential. Strategic communication, early-stage public education, and cross-sector collaboration are necessary to scale solutions.   FoodTech's promise lies not just in technological novelty—but in creating a more efficient, equitable, and sustainable global food system.   To read the full article, visit our Hebrew main blog

Israel is one of the most densely populated countries in the OECD, with a fast-growing population and limited land. Rapid urban expansion consumes about 30 km² of open spaces each year, fragmenting natural habitats. This process weakens biodiversity, increases vulnerability to climate change, and undermines essential ecosystem services. To address these challenges, Israeli planning authorities have begun integrating ecological corridors  into national and regional spatial plans. These corridors connect open landscapes and protected areas, enabling wildlife movement, genetic exchange, and the preservation of resilient ecosystems. While development projects such as roads or railways may intersect them, new planning rules require ecological crossings or alternative solutions to maintain continuity. International experience highlights the effectiveness of such approaches. France’s “Green and Blue Grid,” the Netherlands’ national corridor system, and Germany’s legal framework for ecological networks all show how connecting nature can coexist with urban growth while enhancing long-term sustainability. Beyond ecological benefits, the corridors hold significant economic value. Ecosystem services in Israel are estimated at 6.49 billion NIS annually, including food provision, climate regulation, and flood prevention. Preserving open spaces also reduces future public spending on disaster recovery and infrastructure, while boosting property values near green areas. Ultimately, maintaining ecological continuity is not only an environmental necessity but also a strategic economic investment. By protecting and strengthening open space connectivity, Israel can secure both biodiversity and social resilience, ensuring healthier communities and stronger long-term growth. To read the full article, visit our Hebrew main blog.

This post critiques the overemphasis on carbon metrics in ESG strategy—what the authors call "Carbon Tunnel Vision". While carbon accounting offers clarity and comparability, it risks narrowing the definition of sustainability to a technical exercise, sidelining broader impacts and deeper transformations. Instead, the authors advocate for a holistic approach that treats sustainability as an organizational and cultural shift—not just a data point. Day-to-day operational changes—like employee commuting habits, reducing single-use plastics, and managing waste—are not just tactical moves but powerful levers for shifting mindsets and behaviors. By engaging employees in tangible, habit-forming actions and designing infrastructure that enables sustainable choices, organizations can move beyond compliance toward true transformation. This shift fosters innovation, strengthens internal engagement, and enhances long-term resilience and employer branding. Read the full post in Hebrew on our main blog

In May 2025, Germany’s Supreme Court dismissed a Peruvian farmer’s lawsuit against energy giant RWE, which argued that the company’s historic emissions contributed to glacial melt threatening his home. While the court found no imminent risk sufficient to justify compensation, it established groundbreaking principles: corporations may face civil liability for their proportional contribution to climate damages – even when those damages occur abroad. The RWE case marks a turning point in global climate litigation, reinforcing the sharp rise in lawsuits against fossil fuel companies since the Paris Agreement. Courts in Europe, the U.S., and beyond are increasingly holding both states and corporations accountable for climate impacts – from the Urgenda ruling in the Netherlands to a landmark 2024 decision against Switzerland at the European Court of Human Rights. These rulings highlight how civil and constitutional law are evolving into proactive tools for accountability and prevention. In Israel, climate litigation is still in its early stages, but existing doctrines such as nuisance and breach of statutory duty could provide a legal basis. Inspired by global precedents, Israeli courts and legislators will likely face growing pressure to clarify the scope of corporate liability for climate-related harms. Ultimately, RWE signals that companies are not shielded by geography or time from accountability for greenhouse gas emissions. For Israel and other states, it is both a warning and an opportunity to adapt legal systems to the realities of a warming world. To read the full article, visit our Hebrew main blog