Natalie Bellis, CEO, The seventy-ninth group.
getty
It’s fair to say that in times of economic turmoil, so many of us, whether individuals or businesses, go into survival mode by focusing only on the immediate challenges.
Still, leaders should not lose sight of longer-term business goals and commitments. Don’t let a crisis situation distract you from the ongoing efforts to conduct business in a more ethical and sustainable manner.
In November, media attention focused on the COP27, the United Nations Climate Summit. At this conference, world leaders come together to commit to a more sustainable future on a global scale. At an individual company level, it brings the focus back to our own ambitions and responsibilities. Commitment to your environmental, social and governance strategy is a long-term investment. In my mind it can’t be something that takes a back seat when times get tough.
I felt very privileged to be in charge of my own company’s ESG strategy, but it is also a huge and challenging responsibility. Still, I know that if we want to identify with our clients’ aspirations to invest and do business responsibly, we must first get our own house in order.
I learned a lot through this process, much of which I think applies to companies in our industry and beyond.
Remember, ESG goes beyond doing the right thing.
In my business, I increasingly see ESG as an important consideration among investors, both institutional and retail. These decisions are driven by personal values, peer pressure and a desire to future-proof their investments. Ultimately, investors are driven by the need to mitigate risk, both financial and reputational.
While “ESG” means different things to different people, to me it boils down to doing business responsibly and having a framework in place for you to demonstrate due diligence. People are rightfully skeptical of brands that make huge commitments without revealing how they will achieve them. But by being transparent about your achievements and challenges and building evidence points to prove your journey – whether it’s a groundbreaking “first” or a local accreditation – ESG goes beyond just doing the right thing. It is the key to a successful business.
In a company like the one I lead, which is rapidly evolving and growing rapidly, it is important to dedicate time and resources to driving the ESG agenda. An objective to consider is setting up an ESG working group with a specific set of goals and accountability across departments. This is something my company has done and progress and risks are fed back to our board.
Organizations can also create ESG category frameworks to track progress and keep everyone on the same page. As you do this, make sure you celebrate milestones and raise awareness throughout the company to ensure that all employees are trained and invested. Without this kind of commitment, there is a risk that ESG will eventually displace the board agenda.
Recognize where you are – and where you’re going.
Another thing I learned is how important it is to recognize and communicate where you are in your ESG journey. The rhetoric you hear so often from big companies is that they are sewing their ESG work. But I believe it is an ongoing challenge. The world is changing, which means the way you do business must change too, and you can always work towards a more responsible and sustainable way of working.
Based on my observations, companies developing an ESG strategy are so often inward-looking; they act on their own instincts and abilities. This is admirable and can be effective, but as a business leader it’s important to realize that ESG isn’t just about you. Ask yourself: Who are the stakeholders our company can influence and what do they think is useful to support the environment and community?
My company put this idea to the test with a recent project in West Africa where our Natural Resources Department expanded a portfolio of mining concessions in the Republic of Guinea. It’s a challenging environment with regard to ESG, and it’s made it clear to us how the efforts we’ve put in need to be considered and robust. To inform the process in Guinea, our team surveyed local communities there to better understand the challenges they face and the reality of their situation. This was a crucial first step and the responses we received were enlightening.
In the end, the project confirmed that we should not make assumptions about what local communities need. Leaders need to listen to and understand what the communities they serve care about, not implement things they do themselves think what the community cares about. This is a crucial exercise in clarity and humility.
Having gained valuable insights from our research, we were able to create several objectives to work towards in the region and a pragmatic action plan to address each. There is still much to do, but by taking a joint approach I am confident that we are on the right track.
Share best practices with others.
The benefit of a company communicating its progress on ESG commitments goes beyond just a reputation boost (although the power of this should not be underestimated). The value also lies in sharing best practices. Consider sharing your ideas, failures and ambitions with the wider business community. Why not cooperate with our neighbors and even competitors?
Ultimately, we all strive for the same goal: doing better business by doing better business.
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