By Maria Blanca
Womentors participated in the latest ESG Forum 2021 along with many other organisations that believe ESG is becoming a corporate imperative.
Being part of the ESG latest forum confirmed to me we are living in a more responsible and conscious era, in which caring about every stakeholder it’s no longer a philanthropic approach but an urgent need for every company.
This reorientation confirms that companies who only focus on shareholders and don’t acknowledge the impact of their business decisions on the environment and society, will eventually fall behind financially and lose the faith of customers.
Customers are increasingly aware of the detrimental impact of our current status quo and therefore demanding companies address ESG concerns to protect the environment, support the community and create inclusive opportunities for the society.
The recent pandemic has left us with a very tough lesson, treating our mother earth with respect is extremely important for our own well being, where an urgent reconsideration of our values is essential to have a brighter future. Mr Cyrus Cheung Partner at PWC pointed out in his presentation that ESG and climate risk are now top priorities for all world leaders.
Furthermore in the ESG Forum 2021 forum, Dr Darwin Chen from UNESCO talked about how important it is to redesign the way we work to achieve a new normal of sustainability smartly.
This made us realise how companies need to be more responsible and listen to the voice of every stakeholder, including their own employees. Employees are urging their companies to make socially responsible business decisions.
In trying to understand employee’s needs, we can see how Maslow’s hierarchy has taught us the advantages of understanding how humans intrinsically partake in behavioural motivation. Maslow has used the terms “safety”, “belonging and love”, “social needs”, and “self actualization”, where in this current climate a more community-actualization is becoming essential for survival. This is clearly more relevant now than ever before. Understanding the correlation between effort and motivation is essential in keeping employees loyal to their organisations.
Fulfilled employees are more likely to stay longer in a company that satisfies their needs and that cares for the environment and society, consequently such loyalty will benefit the company financially as they save in recruitment and onboarding costs and as their employees are more aligned to the overall business strategy.
It was also inspiring to see how different companies understand the definition of inclusion. Mr Edward Sit, Head of Greater China Corporate Development at Raffles Family Office showed an impressive slide celebrating the increase in women leadership appointments, which left the audience wanting to learn more.
As such there are clearly financial advantages to gender diverse companies as more investors are increasingly incorporating assessments of companies’ gender diversity and equity to determine how they might respond to ESG risks and opportunities. Once again companies that struggle to make strides in inclusivity will fall behind and consequently will pose risks for investors.
It is crucial that companies recognise the need to also reflect gender diversity at a board level. Investors in China and HK SAR have rewarded companies that have a higher proportion of female board members which has led to a positive correlation to share price performance.
But not only that, governments and regulators have become increasingly watchful of female representation in companies. The ESG forum made us reflect on how this issue is gaining momentum and publicity, which we can all benefit from.
In conclusion, we need to adopt an integrated approach to resolve the greatest challenges facing us and this pandemic only highlights the need to collaborate in a more inclusive status quo. The correlation between strong business performance and women’s participation in management is striking, where female directors can have a positive, value-relevant impact on the company and that a more gender balanced board is more likely to pay attention to managing and controlling risk.
Want to learn more about how your company can start making the right steps to develop a strategic approach to ESG to create value and remain relevant in an increasingly competitive environment, please contact us at hello@womentors.co
Written by Maria Blanca
9th of April 2021
