It’s Time To Consider ESG / SDG As Part Of Your Business Approach

As the world pushes forward at what seems like an ever-increasingly fast rate of speed, businesses and individuals alike must adapt. As is always said, those who adapt thrive, while those who do not fall off the track, or even worse, stop existing altogether. That’s why today we’re going to talk a little bit about ESG and SDG and why you need to be, at a minimum, thinking more about these terms as you plan your business goals for the future. 

Why this is the way to move forward.

First, let’s go with the obvious here. ESG and SDG can incorporate a long list of items and possible actions which one or a company can take, and it can sometimes be a little confusing or overwhelming. ESG refers to Environmental, Social and Corporate Governance. While SDG refers to Sustainable Develop Goals. For brevity’s sake, let’s just say that it’s a way of thinking and acting that includes social responsibility and not just pure profit driven results at all costs (which has perhaps been a more prominent method of doing business in the past). It’s about making and acting on decisions that are better for people and better for the planet as a whole. Focus on things like efforts to combat climate change, creating equity between people of varying genders, cultures and socially economic backgrounds, and creating cleaner farming practices, all fall into the equation here. For a more in-depth look at what terms like ESG, SDG and CSR mean, check out this article by BoardClic.

Generally, I think we can all agree that it’s a great idea to always strive to do better. Attempting to rethink how we do business in a more positive manner and operate on a day-to-day basis is good for the planet, for you, and for me. With the hazards of global warming knocking more fervently on our door each day, considering initiatives that help mitigate humans’ impact on the earth and its processes is crucial.

Why it’s good for companies and brands.

Sure, it’s quite obvious to stop and think for a minute about how the way one does business affects the earth, but it’s actually quite beneficial for companies as well. Here are a few reasons why:

Customers want it.

Each year, the trend leans more and more in this direction. PWC’s 2021 Consumer Intelligence Series found that “83% of consumers think companies should be actively shaping ESG best practices”. (via pwc.com)

Think about the past few years, and you’ll notice that many brands have already been thinking and operating in this vein. Years ago, the Toyota Prius dominated the pack when it came to hybrid, more fuel-efficient cars. Today, the hybrid range of vehicle offerings spans across many brands. Of course we’ve seen it go one step further with fully-electric cars like the popular Tesla models. Clothing companies have also worked to improve the materials used in their apparel and supply chain processes. Outdoor bands like Patagonia and Outerknown are just two examples of companies pushing the envelope in the sustainability space. You can now find similar moves toward ESG-style decisions across various industries.

Furthermore, when one is seeking new investment opportunities from which to choose, there are now plenty of ETFs specifically designed with ESG / SDG goals in mind. This would hardly exist on the investment radar approach just a few decades ago, but today’s customers want access to such offerings, putting their dollars where their hearts and feelings lie. Check out this list of some ESG-style ETFs here. As we know, it’s always a good idea to meet customers where they are.

Employees desire it. 

Likewise, the reasons customers want to embrace a more consciously thought out approach are the same reasons we see this yearning in the employee realm. “86% of employees prefer to support or work for companies that care about the same issues they do”. (via pwc.com). 

Don’t forget that employees are people too, and they want to feel proud with the work they do every day. Employees want to feel good about themselves and motivated when they get up in the morning, and performing in a role where you feel it more aligns with your personal goals is never a bad thing. We know that happier employees leads to better and more productive employees as well as a higher retention rate within an organization.

You may end up more productive in the long run.

As if you needed another reason apart from customers and employees wanting to incorporate ESG goals into their actions, your doing so may even provide more productive alternatives for you in your operations. It never hurts to take another look at how things are done within an organization or at any step along your chain. Taking another view of how goals and objectives may be achieved can lead you to new insights which you previously had not considered. New ways of thinking is what innovation and forward progression is all about. As you embrace ESG over time, you may come across cost-cutting measures, newer avenues of development, or updated and fresh offerings for you to provide to future customers.

The world is headed towards ESG / SDG. Those who adapt will be the ones that thrive.

As we’ve already seen above, customers, employees and even “91% of business leaders believe their company has a responsibility to act on ESG issues”. (via pwc.com)

If the high percentages listed in this article aren’t enough to at least spark your interest and get you considering your own ESG methods, I’m not sure what will. Just recently, esg.com shared that Neiman Marcus Launches 2025 ESG Strategy.

Companies and brands are making the switch, and you don’t want to get left behind. Young people coming up also care deeply about ESG, and we know that young people are literally the future.

Millennials spurred growth in sustainable investing for years. Now, all generations are interested in ESG options (via cnbc.com) 

Young voices grow louder in company strategies and values (via Financial Times)

It’s quite obvious that eventually this is going to be the new norm. Like technology, the faster you can (and are willing to) adapt, the better off you’ll be to meet your business objectives down the line. Think back to the advent of smartphones and even more recently to the prevalence of social media in business marketing plans. When smartphones first arrived, there were some individuals who found it ridiculous to have a phone that also took pictures or that could double as a calculator. The same is true of social media. Many companies resisted it at first, finding it rather trivial and perhaps just a passing fad. However, it’s virtually impossible to operate in today’s society without a smartphone or to construct a comprehensive marketing plan without at least some element of social media. I’m not saying I like it, it’s just the direction in which the world has progressed.

Instead of being left in the dust, consider getting out ahead of what is coming, and instead become a leader. As a consumer myself, I’m always looking for the companies and brands pushing the envelope of innovation, and that’s where I routinely deploy my own hard-earned money.

The time for change is now.

I hope I’ve laid out a few points that make a bit more sense on why it’s important for companies to at least begin thinking in the ESG / SDG sphere. The world is very clearly heading in this direction. Of course, like always, there will be some companies that refuse to adapt and stick to their guns, doing things the way they have always done them. However, we know that those businesses that consistently take a deeper look at how they operate, and which seek to continually progress, will evolve as the winners in their respective fields. But of course we know you already know this, that’s why you’re reading content on CCW!