Key elements that got us all talking and working to net-zero…
The Sustainable Development Goals (SDG’s)
The Sustainable Development Goals (SDG’s), also known as the Global Goals, were adopted by all United Nations Member States in 2015 as a universal call to action to end poverty, protect the planet and ensure that all people enjoy peace and prosperity by 2030.
Through the pledge to Leave No One Behind, countries have committed to fast-track progress for those furthest behind first. That is why the SDGs are designed to bring the world to several life-changing ‘zeros’, including zero poverty, hunger, AIDS and discrimination against women and girls.
ESG stands for Environmental, Social and Governance – three categories that enable businesses to measure the real sustainable and societal impact of their outputs. These target areas need to see genuine, persistent improvement for us to experience real positive change in the workplace and the world around us.
E, environmental criteria, includes the energy your company takes in and the waste it discharges, the resources it needs, and the consequences for living beings as a result.
S, social criteria, addresses the relationships your company has and the reputation it fosters with people and institutions in the communities where you do business.
G, governance, is the internal system of practices, controls, and procedures your company adopts in order to govern itself, make effective decisions, comply with the law, and meet the needs of external stakeholders.
McKinsey Quarterly, Nov 2019
The 17 SDGs are integrated—that is, they recognize that action in one area will affect outcomes in others, and that development must balance social, economic and environmental sustainability.
Why ESG Matters to the C-Suite
While ESG factors are at times called ‘non financial’ or ‘extra-financial’, how a company manages them can have financial consequences and impacts on business value, including:
- Access to capital
- Cost savings and productivity
- Risk management
- Revenue growth and market access
- Brand value and reputation
- License to operate
- Human capital and employee retention and recruitment
- Company value as an acquisition target
- Ability to acquire other high-quality companies
- Global sustainable, responsible and impact investing grew by 25% between 2014 and 2016 to $22.9 trillion
- 75% of active individual investors surveyed show interest in sustainable investing
- 49% of shareholder resolutions filed in 2017 focused on environmental and social factors
- By 2050, sustainability-related business opportunities are expected to reach $3 trillion – $10 trillion annually or up to 4.5% of global GDP
- 66% of consumers globally report they are willing to more for products from companies committed to sustainability
Giants who have all pledged towards net-zero goals:
Net zero across BP’s operations on an absolute basis by 2050 or sooner.
To become a net zero bank
The world’s first building materials supplier to commit to hitting net zero emissions by 2050.