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ESG the Russian Way


In the conditions of sanctions pressure, the Russian business had to pass from the strategy of development to the tactics of survival. However, it has not stopped the urgency that has come with the ESG-approach;s introduction to the activity of the companies. The ESG approach, which includes measures for environmentally friendly production, social training of a business, and implementation of modern management practices, took unexpectedly high positions in the preferences of prominent Russian businesspeople; such data were provided by the research conducted by Trust Technologies (former Russian representative office of PwC) and the Analytical Center of the National Agency for Financial Research. (NAFI)

The survey’s authors interviewed about one thousand business leaders in October of this year. They found that 83% of them believe that the company should follow the principles of environmental and social responsibility to earn the trust of clients and partners. Furthermore, 94% of the respondents reported that they either already have experience implementing socially significant projects or are planning to start such activities very soon. 

The authors emphasize that despite unexpectedly high rates of Russian business involvement in ESG projects, institutional understanding of this issue is still relatively low. Social responsibility and responsibility for environmental and natural environment protection are included in the corporate values of only over a quarter of all Russian businesses.

However, even this is a relatively high result when considering external circumstances. The dynamics clearly show that Russia’s productive class increasingly internalizes the values of responsibility for the long-term consequences of one’s actions. An unbiased study of information coming from the country’s regions shows that this is a superficial view. In fact, some relatively small business structures, clearly not reaching the scale of the first hundred in the Forbes lists, pay just as much attention to social and environmental responsibility.

Distribution of answers to the question: What corporate values does your company adhere to? The study Puzzles of Trust. Values of Russian Business in 2022.
# in the rankingName of corporate value% of answers
2Accountability to customers63
5Efficiency and performance44
11Social Responsibility28
12Responsibility to nature and the environment27

A Lyceum with a Site and a Team

A good example when it comes to these responsibilities is through the history of internal transformations of the investment company Euroinvest from St. Petersburg. It has been present in the regional market for quite a long time, and it is known primarily as a developer and the creator of some large residential complexes. 

For the last ten years, the company’s management, including its Chairman of the Board of Directors, Andrey Berezin, has been intensively reformatting its business, including all three vectors in the ESG definition. 

The most notable results have been achieved in the direction of social activity, and Berezin has managed to make Euroinvest’s social initiatives in St. Petersburg and the North-West of the country much more conspicuous than those of most top-list companies. This is especially true due to the most recent decision to create an academy for gifted children in Russia’s northern capital. 

The first task is already at a stage of resolution; a plot of land on the shore of one of the city lakes has been allocated for construction, which allows for locating the whole complex of buildings. Among them will be educational facilities, living quarters, and places for art, sport, and science.

The same degree of resolution is also being found with the second task. It is known that Euroinvest is already negotiating with potential college employees, and it is expected that the team’s core will consist of graduates of the city’s most vital physic important mathematics school.

Such large-scale investments in education, atypical for a development company, could seem like a gamble, or a display of desire by the company’s management to curry favor with the regional authorities. With a detailed analysis, however, it becomes clear that Berezin and his colleagues are more complex with their understanding and decision-making processes. 

For ten years, the company has been developing its projects in education and talent support in stages. It all started with partner participation in initiatives held by large charitable structures the Leonhard Euler International Charitable Foundation for Mathematics Support and the World Club of Petersburg. Jointly with them, Euroinvest organized educational platforms, Olympiads, and prizes for the best students and young scientists.

At the same time, the intensity of the company’s cooperation with the leading St. Petersburg higher educational institutions was increasing. This work had a significant practical meaning in that the Euroinvest management was solving its personnel problems by looking for prospective employees for its development division and the rapidly expanding industrial and innovation cluster. An equally important part of its raison d’être was to support young, talented city residents; it is no coincidence that cooperation with universities later gave birth to establishing Euroinvest’s scholarship. It was named after the famous Soviet cosmonaut Georgy Grechko, and it is awarded to students and young scientists who have achieved significant results. 

Public Spaces as a New Environment for Life

The second semantic block of the ESG-objective, environmental awareness, made the team at Euroinvest realize some important new aspects somewhat unexpectedly.

On the one hand, the emphasis on using environmentally friendly building materials and the active inclusion in residential complexes of entire green areas, not limited to lawns and rare trees. The St. Petersburg developer has gone even further; a couple of years ago, he offered potential customers a qualitatively new concept of housing, based on sales not just of square meters but a total environment for living. In which environmental friendliness in all its senses has a special place.

According to the authors of the concept called 3ID, a modern person cannot and should not limit his private life to the walls of the apartment. On the contrary, extracurricular and leisure activities, whether sporting, communicating with relatives and friends, or playing with children, should be as activities carried out in public spaces as possible. In turn, it must be designed and built to be attractive, comfortable, and safe for people to be in them.  This is why Euroinvest’s projects have such spaces that are much bigger than in projects of other market participants, whilst also boasting a fantastic diversity. In some of the company’s residential complexes, for example, the accent is made on the co-working rooms and creative workshops. In some others, the leisure zones are, among other things, placed on the roofs. In a few cases, there are landscaped lounge areas, and in others, there are full-fledged SPA complexes.

It is clear that the company has made systematic progress in this direction. Let us note only one more eloquent detail – Berezin and his team have been actively developing their agricultural cluster for the last twelve years, in which also the ecological approach has a special place.

From the very moment of acquiring land and production facilities of one of the farms in the Pskov region, the holding staked on clean production, providing customers with high-quality and safe products while having the most moderate impact on the environment. Therefore, the production of crops, milk, and dairy products under its label was developed. The logical continuation of the company’s policy in the agricultural sphere was the conclusion of an agreement with the Leningrad Zoo this year. According to the document, the Krasnoye Znamya cluster, owned by Euroinvest, began supplying fodder for the institution’s animals. 

Venture Capital Projects and Looking to the Future

There remains the third direction is management culture. Here the company’s experience in developing its innovative production attracts special attention. This segment of Euroinvest’s activity is now concentrated at three plants in St. Petersburg. To a greater or lesser extent, all three are related to the electronic sphere, and the teams of each of them have experience in the implementation of science-intensive projects.

Nevertheless, by the time the holding purchased them, they were not in the best condition. The new owner actively invested in the replacement of the equipment and engineering communications, as well as in the staffing of each enterprise. However, the fundamental step was creating a new link in the holding structure to manage all high-tech assets. It became its venture fund, called Euro Venture. The fund has significant amounts at its disposal. This brings together experienced and competent industry experts with the necessary knowledge to determine the potential economic efficiency of various innovative projects. The initiatives supported by the Fund’s experts also receive target financing for their development. This ensures the high effectiveness that comes of the work. 

There have been several projects created based on Euroinvest enterprises, which can become a new word in their branches of knowledge. These include special batteries for electric cars, new generations of biochips for diagnosing viral diseases and carrying out personal genetic tests, and sensors for remote evaluation of ice thickness on various objects. The most famous of the holding’s developments is undoubtedly the robotic medical complex for radiation treatment of lung cancer. It allows surgeons to irradiate tumors and surrounding tissues directly during operations, thereby ensuring an exceptionally high-efficiency level and low risk of recurrence.

To conclude, it should be noted that in all three listed directions of ESG approaches implementation in Berezin’s company, there is one more component uniting them. It is the emphasized manifestation of citizenship and a responsible attitude to the destiny of the country and the small motherland. It can be seen in many ways, including the activity with which the company protects the historical development of St. Petersburg, which is extremely important in the context of the state’s cultural development. The main thing is Euroinvest’s readiness to invest in the future, not only its own but also the expected future. 

“I believe that the most important thing is education because now nothing but education will be quoted worldwide. Have you read the book Technologies of the Fourth Industrial Revolution? It was written by one of the founders of the Davos Forum, Klaus Schwab. What used to matter was a territory, markets, and raw materials. All this is gone and does not mean anything anymore. What matters is the human capital, the intellectual potential of a country. In the world, only what you can invent yourself is valued. There is a division between those who can create something and those who are useless to the world, even as consumers. And the main thing for us is not to fall by the wayside at all.” 

For Reference:

Andrey Berezin was born in 1967 in Leningrad. He graduated from secondary school #239 with an advanced study of mathematics. In 1990, he graduated with honors from the Leningrad Ustinov Mechanical Institute. In 1990 he graduated with honors from the Leningrad Ustinov Mechanical Institute, where he specialized in automatic control systems for aircraft. During his studies, he was Lenin’s and Ustinov’s scholar and had scientific publications. In 1990 he enrolled in a post-graduate course at LMI and started a similar business. 

In 1993 he took part in creating the North-West Fisheries Company. In 1995, together with Yury Vasilyev, he founded the Euroinvest investment company and had been its Chairman of the Board ever since.

Today Euroinvest is a diversified holding company, which includes companies and projects from different economic sectors.

One of the directions of Euroinvest work is legal and engineering support for developing land plots and territories in St. Petersburg, the Leningrad region, and other areas.

At the end of 2017, Euroinvest Group created its construction division Euroinvest Development, which is engaged in the construction of housing and other objects, thus forming a full-cyclee development business.

A relatively new direction for Euroinvest is the agro-industrial sector. Agrocluster Krasnoye Znamya in the Pskov region specializes in producing grain and fodder for livestock.

In May 2017, the managers of IC Euroinvest established a venture fund Euro Venture with an initial amount of € 10 million. Priority areas of investment are innovative developments in the scientific and technical sphere and projects in the creative industry.

In 2017, Berezin was awarded a certificate of merit by the Ministry of Industry and Trade of Russia for his significant contribution to developing the Russian industry and many years of diligent work.