Change Happens for a Reason: The Driving Forces Behind ESG Adoption

5 Apr

One of my goals this year was to get back into reading the extensive amount of books on my bookshelves. I’m a sucker for a recommendation (if you have any, get in touch!). I was actually reading a novel recently, and I took note of this quote: “If nothing is in need of change then why bother?”.

In a world that is rapidly changing, businesses are increasingly recognising the need to adapt and evolve. One of the most significant shifts in the business landscape in recent years has been the growing emphasis on environmental, social, and governance (ESG) factors. More companies are adopting ESG practices to demonstrate their commitment to ethical, sustainable, and responsible business practices. So, what are the driving forces behind this change?

Growing consumer demand for responsible businesses.

In my experience, consumers are more informed and conscious of the impact their choices have on society and the environment. They are increasingly seeking out products and services from companies that align with their values. As a business owner, I've seen firsthand how companies that prioritize ESG concerns tend to attract more loyal and supportive customers.

Pressure from investors and regulators

Investors are becoming more attuned to the long-term risks and opportunities associated with ESG factors. As a result, companies that demonstrate strong ESG performance are more likely to attract capital and enjoy lower financing costs. Furthermore, regulators are beginning to mandate greater transparency and disclosure around ESG issues, compelling businesses like mine to integrate these considerations into our decision-making processes.

Talent attraction and retention

A company's reputation for social and environmental responsibility plays a crucial role in attracting and retaining top talent. Many employees, particularly the younger generation, are seeking to work for organizations that share their values and contribute positively to the world. I've found that having an ESG-focused company is more likely to have engaged and motivated workforces, which can lead to higher productivity and lower employee turnover.

One example is our favourite after-school friends, Ben & Jerry's - A B Corp Pioneer in ESG Adoption Ben & Jerry's is a well-known ice cream company that has embraced ESG principles and achieved B Corporation certification. They lead in Environmental Stewardship, sourcing ingredients from Certified Fair Trade suppliers and achieving a 10% reduction in GHG emissions per pint of ice cream compared to 2015 levels.

Ben & Jerry's also uses its platform to raise awareness about critical issues, such as racial justice, LGBTQ+ rights, and climate change. They support refugees and underrepresented communities, including partnering with the International Rescue Committee to create job opportunities for refugees. Ben & Jerry's community engagement has always been outstanding. They have a long-standing history of supporting local and global communities, donating 7.5% of its pre-tax profits to philanthropic causes. Employees are also encouraged to volunteer through its "Love, Peace, and Ice Cream" program.

Further to this, As a certified B Corporation, Ben & Jerry's meets rigorous standards of social and environmental performance, accountability, and transparency. The company is also a wholly-owned subsidiary of Unilever, which has integrated Ben & Jerry's B Corp values into its broader sustainability commitments.

It’s exciting to see companies move forward with their ESG goals. We must remember that there is a deeper reason for all this work as a private sector community, and it comes back to looking after our people and our planet.

Today, my laptop stand consists of 3 books, ‘Developing Communities For The Future’, ‘Introduction to International Development’ and ‘Managing Human Resources’. A throwback to uni days and a symbolic reminder.

We remain committed to integrating ESG practices into your company's operations and decision-making processes. By doing so, I help build businesses that not only thrive financially but positively impact the world around us to bring systemic change.