ESG in practice The business environment is constantly learning, so there is always room for debates regarding work dynamics and the company’s social responsibility.
In this context, the ESG Agenda has been given a guaranteed space. Much more than an organizational transformation, ESG in practice requires a cultural transformation.
After all, the goal is to bring actions involving the environment, society and corporate governance into the company’s DNA. This change must be so significant that ESG activities are not mechanized; quite the opposite, they flow naturally throughout the organization.
In this corporate challenge, more and more new startups are emerging every day to offer strategic solutions to medium and large companies. But before we talk about them, learn more about ESG.
What is ESG?
These are guidelines for responsible asia mobile number list management based on three pillars: Environmental, Social and Governance. The acronym ESG represents the English names: Environmental, Social and Governance. As you can imagine, this practice did not begin in Brazil.
The term gained notoriety after a publication called Who Cares Wins, in 2004, by the Global Compact in partnership with the World Bank. The document gained space for debate because it was based on a meeting of CEOs of large global financial institutions with the Secretary-General of the UN (United Nations).
Since then, the topic has gained ground. As reported by Climate Change and Sustainability Services, following ESG guidelines is essential for investors when making decisions. And it goes a little further: companies that ensure these practices gain a good reputation when closing contracts with suppliers and customers.
It is believed that the term Agenda accompanied by the acronym arose due to the publication, cited above, establishing priority actions and investment funds for emergency actions. As if it were an “agenda”, until then European, for the coming years, until 2025.
Advantages of adopting ESG principles?
Although there are still people who are good idea when searching for the ideal to the importance of the concept, a survey conducted by Amcham (American Chamber of Commerce), with a total of 178 respondents, revealed a motivating scenario. Of those interviewed, including leaders of companies of different sizes and startups operating in Brazil, 93% responded that they identified advantages for the business of implementing ESG practices.
But what advantages would these be? From a financial point of view, there is market pressure for investors not to invest in companies that do not practice such measures.
Another positive aspect is that companies dedicated to meeting ESG requirements have become attractive to stakeholders.
As a result, Brazilian funds that comply with sustainability and governance standards doubled in size in 2020, reaching 1 billion reais, as pointed out by the Brazilian Association of Financial and Capital Market Entities (Anbima).
And if in financial terms, the real motivator of great corporate leaders, ESG is doing well, why is there still resistance? We can highlight some reasons:
- Before you see money coming back, you have to invest some money. In other words, you have to spend it before you can earn it.
- Small and medium-sized companies believe that these actions are exclusive to large companies. Therefore, they do not plan low-cost solutions.
- It requires a change in culture, in which everyone understands the importance of their role in the process and how the company values such attitudes.
- At the same time that companies are encouraged to create quick solutions that are accessible in the corporate sphere and executable in the short term, they are also encouraged to carry out mapping and propose goals with an eye on the future. In short, it takes work!
ESG in practice
ESG is not a set of fancy or b2b reviews theories. In fact, it can understood through practical actions. Following these principles requires the company to reflect on the activities it carries out. Furthermore, what can it do to improve this reality, enhancing the positive aspects and minimizing the negative ones?
A good guide to starting ESG actions is to analyze whether the company is with the Ten Principles of the Global Compact. These are:
And to help with this reasoning, below are some questions that involve each acronym in particular.
Environmental
How has waste been of in the company? Does the location where it is carry out the appropriate treatment or disposal? What is being to reduce water and energy consumption? Does the company have control over these expenses? What are the annual goals for rationing? Does the company communicate the importance of these actions to everyone?