Going Beyond ESG: Accelerate the change, co-design the blueprint
Written by Ben Carpenter, CEO of Social Value International
Recent discussions about ESG and specifically the International Sustainability Standards Board (ISSB) have become increasingly heated and fractious. Last week the financial times posted an article titled Sustainability schism raises questions for the ISSB[1]. It nicely summarised the fierce debates by asking:
Is the ISSB an imperfect but necessary first step towards greater clarity and rigour, or a fudge that will perpetuate flaws in ESG while satisfying nobody?
Since 2007 the SVI networks have all campaigned for a paradigm shift in the way we account for value. The ISSB, in its current state and remit, is the most incremental of steps towards our shared vision of a world where decision making and ways of working reduce inequalities, environmental degradation and optimise wellbeing. We have spoken about this development before.
There are many individuals within the social value and wider ‘sustainability’ movement who do see the ISSB as a fudge, ESG ratings as a ‘mirage’, ESG investment as a futile path based on a flawed logic that financial markets can solve the problems created by financial markets. But what we cannot deny is that ‘ESG investment’ is growing, ‘ESG reporting’ is being formalised, ‘ESG’ as a term cannot be ignored. As a community of impact and sustainability practitioners we must be proactive and productive in the evolution of ESG practices. We can only accelerate a gradualist approach to change by offering a clear path forward.
So, “Going Beyond ESG” is a month of dialogue and engagement designed with two objectives:
Understand the differences. We must make clear the differences between the terms; ESG, Impact and Sustainable Development. These are three very different concepts and we owe it to ourselves as a movement (that is growing rapidly) to ensure there is clarity on the differences. Using the terms interchangeably is unhelpful and dangerous.
Offer practical solutions. We must demonstrate that ‘going beyond ESG’ is possible. We must articulate how ESG practices, the ISSB and financial accounting in general should evolve. Change can be slow but it can also happen quickly and the next five years are crucial. Together we can pave the way for more systemic changes.
SVI are calling on you to be part of the conversation and help ESG practice become Impact Management practice. Please add your responses to our survey. Join our facilitated conversations (register here) and share your views with us (#BeyondESGMonth) as we compile a practitioner led blueprint for evolving ESG.
[1] Beneath the article on hydrogen. Scroll down!