「ESG·益起读VOL 16」The Missing Link Between ESG and Corporate Innovation
朗读者：赖雨杉
毕业于阿尔弗雷德大学
导读
来自Wharton and Penn Engineering的专家勾勒了一个框架，致力于将ESG从公司债务转变为有利于所有利益相关方增长的创新动力。
ESG has become a main topic of shareholders, boards, and C-suites. Billions in capital have been deployed through Impact or ESG-rated funds. Ninety percent of S&P 500 companies now have ESG strategies, and ESG mentions grew over 300% in investor briefings. Major indices have been created to measure and benchmark ESG plans and activities across companies. Yet how many of these efforts are driving real impact for society?
In a post-pandemic world, “doing well by doing good” is not just a nice aspiration, but also has become an expectation for future employees and customers. In 2023, at approximately 2 billion, Generation Z makes up the largest population block in the world. Nearly 55% of the Generation Z population (approximately 1.1 billion) favor socially responsible and eco-friendly businesses, brands, and products. In this 1.1 billion there are of course current and future consumers, employees, and influencers that all matter to companies and organizations. Companies like Patagonia that openly promote clothing recycling with their customers, or Unilever which focuses on developing products that require minimal water-use for developing markets, are more likely to gain the attention and spending of more educated consumers. Words alone will not be enough.
It’s worth noting that ESG must account for environmental protection or reducing the negative impacts on the environment (E), delivering a positive social impact especially for under-represented and marginalized social groups (S), and governing with transparency and fairness (G). Several frameworks have emerged for organizations to measure the performance and impact of ESG-related programs such as the Global Reporting Initiative (GRI), Sustainability Accounting Standards Board (SASB), United National Global Compact (UNGC), and Taskforce on Climate-related Financial Disclosures (TCFD). While these frameworks attempt to drive commonality in how companies communicate their ESG activities driven mostly by investors and regulators, none of them directly measure how innovation efforts are driving ESG impact. This presents an opportunity to rethink ESG as a framework for shaping and delivering purposeful innovation, both in the way companies operate as well as the way they develop new products and services.
“There is no clear framework for organizations to embed ESG priorities within their R&D and innovation efforts.”
What’s Working and What’s Not?
As noted earlier, ESG has gained critical mindshare across all stakeholders — consumers, employees, corporate leaders, governing and regulatory bodies, and of course investors. This mindshare is also directly supported by investment dollars attached to ESG efforts. Bloomberg Intelligence has tracked ESG asset growth from $22.8 trillion in 2016 to $35 trillion in 2020 and projected to $50 trillion by 2025. There are also very tangible product examples that have advanced technology innovation and profits while creating a meaningful and measurable positive environmental impact. Apple in its ESG report notes that the transition to the M1 chip in its 13-inch MacBook Pro reduced the product’s carbon footprint by 8%.
However, there still remain significant challenges to fully realize and measure the profitable impact of ESG. There is a lack of standards and benchmarks that can be consistently followed by organizations. At the same time, there is no clear framework for organizations to embed ESG priorities within their R&D and innovation efforts. Investors at times have shown significant skepticism with ESG objectives and requirements, believing that the ESG requirements tend to be too strict and can get in the way of generating maximum returns on their investments.
Thus, many challenges exist that prevent companies from focusing their innovation efforts and resources on these ESG goals, including 1) seeing ESG as a compliance activity, 2) lack of clear ownership and success metrics, 3) no immediate ROI or link to company performance, 4) lack of integration into R&D portfolio planning, and 5) limited employee engagement and understanding.
“What’s preventing companies from moving ESG from a periodic reporting activity to a platform for fueling the company’s future innovation and R&D efforts?”
来源:
Snyder, S. A., & Macwan, S. (2023). The Missing Link Between ESG and Corporate Innovation. Knowledge at Wharton. Available at: https://knowledge.wharton.upenn.edu/article/the-missing-link-between-esg-and-corporate-innovation/
