SIFA Strategy has reviewed statements from investors, investment bodies, academia and commentators about their expectations as to the best form of corporate recovery from COVID-19. Investors have highlighted their resolve to identify businesses that provide the long-term resilience to succeed in the “new” normal, as we all face a very different economic, social and behavioural landscape.
Many Boards are questioning whether the ESG agenda should be maintained against a declining economy or should be sacrificed for short-term financial gain. The answer lies in the need to demonstrate business resilience. In addition to a sound business and financial model, resilience will be judged against a closer assessment of the potential risks, and opportunities, from the continued impact from the environment, climate and social changes. How these affect the strategy and behaviour of a company, together with the willingness of stakeholders to support the business, will be key.
Environment, climate change and social issues have become an important component of financial stability. Leadership teams will need to identify and manage them as a factor of materiality particular to their business, rather than as a reporting framework.
ESG, if implemented properly, can build the case for business resilience to secure value and job creation, as well as reduce risks and costs.
If you would like a copy of how the proper implementation of ESG can build business resilience please Contact Us.