Acceleration was my word of 2020. The pandemic has accelerated acceptance that business cannot exist for the sole purpose of profit, nor separate business objectives from surrounding social issues.
Action must be the word of 2021.
#BuildBackBetter: we have the chance, let’s take it.
Collaboration between business, nonprofit, government and academia is increasingly needed to provide the solutions and resources we need to make change.
Diversity and the celebration of the full panoply of people is just starting to be acknowledged as a richly rewarding business strategy.
[D is also for realising that paying Dividends or Directors’ bonuses while taking government money is not a winning strategy.]
Employees’ physical and mental well-being has been at the forefront for many companies, while others have expected them to put their job before their health and families.
Frameworks for reporting ESG impact and progress towards achieving the UN’s Sustainable Development Goals have rapidly developed this year.
Giving to effective charities who focus every day on addressing the needs of society and the planet is vital: The Big Give’s Christmas matched funding campaign raised more than £20.1m in eight days for over 750 charities.
Hunger has increased: The Trussell Trust in the UK recorded a 47% increase in the number of parcels distributed during the first six months of the pandemic.
Institutional Investors, and ordinary savers, increasingly want to invest in companies making reportable ESG impact. Photos of employees volunteering in company t-shirts are being replaced by companies producing an ESG Investor Presentation.
The Joyful Environmentalist is a great book to kick-start your personal contribution to caring for the planet and change the way you shop, bank, eat, travel …
KPIs are needed for ESG work – as they are for revenue-generating work – to ensure priority is given to activity and for employees to find meaning in their daily work and can easily connect it to their employer’s purpose beyond profit.
Local retail shopping has continued to decline in favour of online shopping, at the same time as some local shops have proved to be vital; 2021 may determine the future and function of our high streets, with an impact on community cohesion and livelihoods.
Milton Friedman, the ‘dinosaur economist’ and those who believe that the only ‘social responsibility of business is to increase profits’, is fast going out of fashion.
New normal: slamming on the brakes has disrupted the status quo of how people and companies think things need to be done. We now know that companies can be productive without constant overseas travel, without employees crowding onto commuter trains, and that they can rapidly pivot to using technology.
Opportunity to use whatever influence we have to make progress on what the world needs. As a Non-Executive Director at The Panoply I’ve been given the opportunity to Chair our new ESG Committee; ensuring that our financial and non-financial commitments and reporting are given equal weight.
Purpose beyond profit is what every business needs to find. Your business needs to be profitable, but not at any cost; and your purpose needs to hold your business to account. There is a growing group of consultants from all avenues of industry that can help.
Quantifiable metrics are needed to ensure that business is really making ESG progress.
The BBC’s 2020 Reith Lectures were delivered by Mark Carney, former governor of the Bank of England, on ‘how we have come to esteem financial value over human value … and how we can turn this around.’
‘Swimming naked’ and ‘the first to suffer’ from the effects of the pandemic, was Klaus Schwab’s description of companies who have been ‘endorsing stakeholder capitalism [while steering] their rising profits in recent years towards share buybacks and higher executive bonuses’. The FT created a corresponding list of business ‘Saints & Sinners’.
Tax is needed to pay for the costs of the pandemic: it’s difficult to have a convincing ESG strategy with unusual tax arrangements. The Fair Tax Mark recognises companies who have paid the right amount of corporation tax at the right time and in the right place.
Urgent action is needed now; ESG is not a ‘nice to have’, ‘when we have time’ add-on or afterthought, it’s an essential part of how every business needs to operate, now.
A ‘value creation story’ which ’integrates all the factors contributing to how each business creates value for society’ acts as ‘an accelerator of ESG purpose … as distinct from merely adopting a compliance-led ESG approach’: Blueprint for Business in a working paper on Purpose and ESG
‘Warning lights—for our societies and the planet—are flashing red’ and without ‘great transformation’ we are at risk of reversing the progress the world has made on the climate and social equality, according to UNDP’s 2020 Human Development Report.
Generation X: while Millennials and Gen Z dominate the workforce and clamour for change, it’s Gen X’ers in senior roles who have the power to make the change. Anecdotally, spending time working from home this year has increased the influence of their own children asking ‘what are you doing to protect the environment?’ or ‘what are you doing to give all kids a good education’?
Young people will bear the human and financial cost of the pandemic for the longest time, but also bring the biggest hope for change. I’ve been privileged this year to have advised a number of 20-somethings – including from the Saïd Business School, Oxford University – who are crystal clear that they want to work for companies which share their values and to contribute their skills to making significant social change.
Zero hours contracts: we’re clearer this year than ever before on exactly who our key and frontline workers are – and how many of them work on sub-optimal contracts, low wages, without basic benefits, or in poor conditions.
Profit with Purpose works closely with businesses to help them discover, develop and embed an ESG strategy that is tightly aligned with the goals of their organisation. Our team applies its in-depth knowledge and first-hand experience to ensure the strategy adds value and motivates your business to take action.
Here’s a recent case study of our work with Experian.