Monday - April 18, 2022 | News & Views | 3 min read
No Easter eggs here, sorry. With Earth Day fast approaching, our focus is on the environmental, social and governance (ESG) risks and opportunities that companies are facing. (Although the chocolate is very tempting indeed.)
The geopolitical picture is so fluid, which is why to help you keep a sharper focus, we are happy to share five of the more insightful or illuminating articles, blogs, podcasts or videos that we see each week.
If there are other stories you think we should include next time, please share them at firstname.lastname@example.org.
1. A new survey by Harris for Google Cloud revealed some startling statistics. Over two-thirds (68%) of American senior business executives admitted their companies were guilty of greenwashing. Worldwide that percentage fell to 58%, but it is still a startling misdirection. Furthermore, 65% of these executives said that although they wanted to improve their sustainability efforts, they did not know how to do so. And only just over one-third (36%) knew how to measure their sustainability efforts. There is a huge knowledge gap. If only these companies knew a world-class ESG education provider…
2. Money talks. Deloitte is investing US$1 billion in its sustainability and climate practice. This huge sum is to help their clients meet the fast-changing disclosure, regulatory and tax requirements and regulations and speed up the transition to net-zero of their organizations and their supply chains as part of embedding sustainability into operations across the organizations. “Taking action on climate change and sustainability more broadly is not a choice, said Punit Renjen, Deloitte Global CEO in a press release. “It’s an imperative. And we all have a role to play. But it’s the business community that’s best positioned to lead the way on this.” We couldn’t agree more.
3. This month, more than 1,300 of the largest UK companies will have to publicly disclose their sustainability strategies and actions. The United Kingdom is blazing a trail for the business world by being the first country to set in legal stone the voluntary disclosures recommended by the Task Force on Climate-Related Financial Disclosures (TCFD). The Financial Conduct Authority (FCA) is enforcing the new laws whereby businesses have to report on the climate-related risks and opportunities that are material to their operations as well as show how they are dealing with those in their annual reports. This new accurate supply of information can only be good news for sharp-eyed investors.
4. The defence industry has been a huge beneficiary of Russia’s war on Ukraine. Many countries allocated new budgets worth billions of dollars towards defence spending, with Germany’s sudden allocation in February of €100 billion one of the headline items. More unexpected has been its reframing as part of ESG risks and opportunities. With President Zelensky’s regular calls for arms plus many countries feeling vulnerable to Russian aggression, this kind of defence spending is now being categorized under “S” as a social good for defending democracy. However, since some companies continue the manufacture of cluster bombs and chemical weapons, that definition may still need some work.
5. Business for Social Responsibility (BSR) has released a rapid human-rights due diligence tool to help companies address the new geopolitical realities in Ukraine and beyond. Businesses with ongoing operations, supply chains and customers in the region are especially vulnerable to human-rights abuses. The tool is designed to help answer concerns around matters such as:
- Whether it would be responsible for companies to stay operational and how to responsibly leave if their presence is no longer possible.
- When, why and how a corporate leader should address a political situation, and how that choice might impact employee mental well-being, safety, or security
- How to have positive impacts on the human rights of Ukrainian staff members
[We hosted a session last month for our faculty, alumni and current attendees to discuss the awful events in Ukraine and how boards could respond. This discussion resulted in a 20-point checklist.]
Mathew Loup is Competent Boards’ Director, Marketing & Communications. Connect with him on LinkedIn.Back To News & Views