ESG Questions Your Company Needs to be Able to Answer
Over the last decade, the business world has seen a dramatic emphasis placed on the concepts behind ESG, stressing their importance for sustained success in the coming decades. However, implementing an ESG strategy is a multidimensional challenge, and brands must be aware of the drawbacks and benefits implementation may bring. To help frame these factors, Harvard Business Review has compiled a list of 10 questions to ask about your company’s ESG process, assisting in defining the needs and mindsets required to reap the full benefits of a well implemented ESG program.
While ESG has been shown to successfully raise profits and customer satisfaction, it is not uncalled for to question its boundaries of success. “Fears that excessive emphasis on ESG could harm a company’s competitiveness are not misplaced. In fact, there are valid questions about whether, if a company places too much energy into ESG objectives, it risks losing its focus on growth, market share, and profits.” Companies must question their implementation at all levels, and find where a hyper-focus on ESG becomes too much. Past a recognition of the challenges of adopting ESG, the article goes into depth around the changes a company must perform to fully take advantage of what ESG has to offer them.
A change present in almost all CSR related conversations is transparency. When addressing current issues, companies must be forthcoming in their goals. “An inconsistent approach risks fostering division among employees and creating a culture of ‘us versus them.’” And a company’s reactivity to public issues should not only be a reaction to the here and now, but a preparation for the future. “According to the World Economic Forum, 85 million jobs will disappear due to automation by 2025;” and while a larger reforming of educational public policy must be made to prepare and train the next generation of employees, “there is also an onus on companies to take active steps to reskill their existing workforce — and specifically to aid its most vulnerable members — to be able to transition into new roles.”
A lot is being asked of companies when adopting ESG into their structures; “Global corporations must approach ESG in a way that is transparent, consistent, flexible, innovative, sustainable, sensitive to cultural differences, dynamic, and future-proofed.” While this will be daunting and challenging to all businesses, that doesn’t mean your company is diving into completely uncharted waters. With guides like this one provided by Harvard Business Review, companies have more tools than ever to ensure that their ESG campaigns are helping them advance and adapt to the present and future.