Companies that have a long-term sustainable value creation strategy thrive even in times of crisis. In fact, companies focused on the long term have demonstrated 47% higher average revenue and 36% higher earnings growth than their peers. Companies that focus on Environmental, Social, and Governance (ESG) factors are more likely to adopt sustainable practices, reducing their negative impact on the environment and society, while strengthening their corporate governance. For example, if a company is transparent about its Scope 1, 2, and 3 emissions as may soon be required from SEC regulation, it will probably attract consumers attracted to buying brands that value environmental issues/protections.
These companies do well while doing good, helping to protect our healthy and prosperous economic engine.
This is core to CECP’s purpose: to empower companies to drive long-term business success through positive social impact. We believe that companies can and should build ESG metrics into their overall business strategies because doing so fosters a better future within the corporate sphere and for society at large. By integrating sustainability into their business models, these companies can attract more socially responsible investors and access new capital sources. Additionally, they often benefit from increased efficiency, reduced costs, attracting ethical talent, more engaged stakeholders, and improved brand reputation, which all positively impact their financial performance.
On a personal note, this is also central to my individual purpose. With political and corporate pushback against ESG on the rise (despite the multitude of benefits noted above), being an ESG advocate has never been more important. Recognizing that my strongest tool is my platform, I know that I have a responsibility to push back on the pushback, and shed light on what needs to be done to safeguard a sustainable future for generations to come. So, let’s get into it.
ESG represents a set of criteria that investors and businesses use to evaluate a company’s sustainability and societal impact through the lens of environmental, social, and governance metrics. Everyone has a role to play including:
- The Individual –
- Use companies’ publicly reported ESG information to make more responsible and values-driven purchasing decisions. By supporting companies that prioritize sustainability and social responsibility, consumers can influence market trends and encourage positive change in broader business practices.
- Protect personal investments by supporting businesses that have a proven ESG track record, as there is growing evidence that companies with strong ESG performance tend to outperform their peers in the long run.
- The Company –
- Attract and retain talent by authentically living your ESG values. Working for ESG-oriented companies can provide a sense of purpose for employees and alignment with their personal values, contributing to greater job satisfaction and overall wellbeing.
- Engage with local communities to understand and help address their social and environmental concerns. This builds local trust and support, which are essential to maintaining broader stakeholder trust and support.
- The Investor –
- Evaluate ESG criteria in investment decisions, as data show higher ESG performance is correlated with higher returns, lower risk, and long-term business sustainability.
If each of us, as individuals, companies, and investors, is not using the tools at our disposal to advocate for breathable air, clean water, and safe jobs for future generations, then we must ask ourselves, what we are willing to lose?
I encourage you to reach out to CECP so we can help you and your team do well by doing good and advance your company’s overall positive impact.
CECP’s upcoming CEO Investor Forum, the marquee institutional investor event where corporations present financially material ESG metrics to institutional investors, will be focused on climate action. Check out the topnotch speaker lineup, which includes CEOs of Siemens Corporation USA, Philip Morris International, Nestlé, and more, and register for free