Recently SenateSHJ’s Consulting Partner Josh Dowse spoke at the PROI APAC regional meeting about the growing role for communicators in ESG. Here’s a quick recap of what it all means and what we can do as communicators.
Investors are looking beyond the traditional financial metrics of a business more than ever to consider those areas we refer to today as ESG – short for environmental, social and corporate governance.
The term might be new, but the concept isn’t. There’s been a torrent of overlapping terms and phrases — you’ve likely heard of “corporate sustainability” or “shared value” or perhaps “ethical investment”. The list goes on.
Whatever you used to call it, you can now basically wrap it all up under ESG. These three letters cover a lot:
- Environmental metrics such as climate, waste, water, plastics, deforestation, palm oil
- Social metrics such as modern slavery, diversity, communities, workforce health
- And the usual governance metrics.
ESG investment funds are growing, and an ESG lens is now orthodox among general investment funds.
Why now? Two reasons.
As a society, we’re more sensitive to the environmental and social impact that companies can have – for better or for worse. But the numbers are also talking. They show that businesses that take ESG factors seriously will, on average, do better financially than businesses that don’t.
There are direct reasons for that, but it’s also a clear belief that ESG is considered a proxy for good management — i.e., if you can manage these areas well, you can likely manage other operational issues well too.
So, how can we help as communicators when it comes to ESG?
The key is to tread the line between going too far and not going far enough. We can’t tell a company how to run its business, but on the flip side must avoid “green stamping” company initiatives that may not be genuine, and could backfire.
As communication experts, we are well set up to support businesses in this space, with certain natural skills and common strategies that we can tap into:
- Support integration: Ensuring a business’s ESG goals are properly integrated right across the business e.g., into brand and operational strategies. If they’re not integrated into those strategies, they won’t last long, just like communication strategies.
- Consider the stakeholders: Researching and bringing stakeholder perceptions into the forefront of decision making. Many experts view ESG as just an extension of ‘stakeholder theory”: the business will do better if it considers all its stakeholder needs – just like communicators do.
- Build partnerships: Bringing together stakeholders and organisations and building external relationships. Getting people to talk to each other is essential to build the engagement, innovation and relationships that are essential to ESG.
- Cut through with communication: Leveraging creative juices, backing it up with solid evidence and dropping the jargon. If an ESG statement sounds like anybody could have said it, it is worthless.
That said, we should not assume we can automatically cover all ESG bases just because we have these skills. There are some complex areas with their own complex rules and metrics, so it will be good to build relationships with specialists in those areas.
As ESG continues to gain momentum, our role will continue to evolve. Now is the time to consider where we can make the best impact.