The Strategic Power of ESG: What Boards Can and Must Do
Businesses and institutions face – and report on – financial risk. But there is an array of financially material issues which are equally, if not more, critical to success or failure. These include climate change, business ethics, operational impact on the environment, how diversity and inclusion is addressed, unwanted turnover, cyber security and slavery and child labor. These risks fall under the rubric of environmental, social and governance (ESG) management and reporting.
While ESG issues are commonly dealt with as risk factors, there is another important lens that boards and executive leadership may want to consider: Pursuing a sustainable business model can yield significant benefits to the business, ranging from improved value chains, increased durability and resilience, lower cost of capital, enhanced employee engagement, reduced potential for commoditization and increased differentiation and competitiveness.
Depending on the nature and sophistication of a business and its leadership, boards and the CEO should consider explicitly how they want to tackle ESG and its benefits. There are distinct stages of ESG maturity, each of which requires a different level of attention paid to staffing, operational compliance, how stakeholders are dealt with, governance models, reporting, etc. The speaker will describe these in detail and lay out the advantages of moving from one level to the next.
As boards review business strategy, ESG ought to be a crucial point of reflection.
Attendees will be provided with the slides from the presentation, as well as a comprehensive white paper.