- Even during the pandemic, companies continued to strive for more sustainable and inclusive business models and societies.
- Companies and investors are committed to respecting common ESG reporting standards and the principles of stakeholder capitalism.
- We can apply the lessons learned from the pandemic to climate change.
- In this context, the Forum annually hosts the Summit on the Impact of Sustainable Development from September 20 to 23.
“We owe most of the social progress of the past to entrepreneurship and the ability to create wealth by taking risks and pursuing innovative new business models,” wrote the founder and executive chairman of the World Economic Forum Klaus Schwab. at the height of the pandemic. “But we need to rethink what we mean by ‘capital’ in its many iterations, whether financial, environmental, social or human.”
This is one of the many lessons we have learned over the past year and a half.
In the midst of a global pandemic, a global economic crisis, a global crisis of nature, a global movement to end systemic racism and many extreme weather conditions, stakeholder capitalism – and the role of business in achieving a more sustainable and inclusive world – is more important than ever. These will be a key topic during the Virtual Summit on the impact of sustainable development of the Forum 2021 from September 20 to 23.
This is especially true when it comes to the climate crisis, “the biggest global challenge we face in the years to come”, according to the co-chairs of the Alliance of CEO Climate Leaders, and a challenge that will have a impact on our ability to meet all challenges. 17 Sustainable Development Goals (SDGs).
“We need to see increased commitments under the global Race to Zero campaign as we head to the COP26 negotiations in November,” they wrote. “It is essential that the business community assumes a clear leadership role, establishing high ambition in its own fields, shaping the practical modalities of implementation and advocating for policies supporting the required transformation of the global economy. “
Yet all stakeholders, including businesses, are tackling this with renewed vigor – and the fact that so many companies have stepped up to respond to the pandemic is a sign that we can meet these goals, wrote Schwab in June.
“Obviously, the will to build a better society does exist,” he continued. “And that will require private sector engagement every step of the way. “
Sustainable development goals to improve business
While companies engaged in stakeholder capitalism should pay attention to the 17 SDGs, achieving the goals of two in particular will help improve business:
SDG 9: Industry, innovation and infrastructure. The goals include promoting inclusive and sustainable industrialization and, by 2030, significantly increasing the share of industry in employment and GDP and doubling its share in LDCs. Others include improving access to financial services for small businesses, upgrading infrastructure, and upgrading industries to make them sustainable.
SDG 12: Responsible consumption and production. The objectives include the achievement of sustainable management and efficient use of natural resources and the reduction of waste generation and the achievement of environmentally sound management of chemicals and the reduction of their release. The goal also encourages companies (especially large ones) to adopt sustainable practices and to integrate sustainability information into reporting cycles.
How much progress has been made?
We know companies are making progress on critical environmental, social and governance (ESG) challenges – and the quality and quantity of ESG reporting has doubled since 2017, according to last year’s SDG progress report. However, since the idea of stakeholder capitalism was born in Davos in 1973, “we don’t have the capacity to measure” progress in all sectors, wrote Brian T. Moynihan, chief executive officer of Bank. of America, for the Forum.
Today, with the support of 140 CEOs, “Measuring Stakeholder Capitalism Towards Common Metrics and Consistent Reporting of Sustainable Value Creation” was published by the Forum in collaboration with Deloitte, EY, KPMG and PwC.
These core ESG metrics and information help companies improve the way they measure and demonstrate their contribution to a more prosperous and fulfilled society and a more sustainable relationship with our planet.
These measures are not only good for stakeholders, but also for shareholders: “Beyond the crisis horizon, more and more evidence appears that companies that follow more narrowly defined ESG standards outperform on average the market ”, argued the authors.
COVID-19 has hit many areas. “The pandemic hit the manufacturing sector harder than during the global financial crisis of 2007-2009, leading to a 6.8% drop in production in 2020,” says the United Nations report on the 2021 Sustainable Development Goals It was “catastrophic” for air transport in particular. , with a drop from 4.5 billion passengers worldwide in 2019 to 1.8 billion in 2020.
But through it all, businesses have continued to scale up – not only helping their employees and communities overcome COVID-19, but also taking action on critical issues like systemic racism.
Now, businesses must learn from COVID-19 to address other pressing challenges, especially the climate crisis.
“If the economic recovery ends with a restart of pre-COVID-19 activities, companies will have missed an important window of opportunity to shift to a more inclusive and greener growth path,” said chief economists interviewed by the Forum last year.
What are the World Economic Forum and its partners doing to create better business?
Business leaders in mining, metallurgy and manufacturing are changing their approach to integrate climate considerations into complex supply chains.
The Forum’s Mining and Metals Blockchain initiative, created to accelerate an industrial solution for supply chain visibility and environmental, social and corporate governance (ESG) requirements, has released a unique proof of concept to trace emissions throughout the value chain using distributed ledger technology.
Developed in collaboration with industry experts, it not only tests the technological feasibility of the solution, but also explores the complexities of supply chain dynamics and defines requirements for future use of data.
In doing so, the proof of concept responds to stakeholder demands to create visibility and accountability “from mine to market”.
The World Economic Forum Mining and Metals community is a high-level peer group dedicated to ensuring the long-term sustainability of their industry and society. Find out more about their work and how to reach them, via our Impact Story.
What can I do to improve business?
- Encourage businesses (including mine) to adhere to the principles of stakeholder capitalism – and support and recognize businesses that are making progress on issues close to my heart.
- Encourage recycling and environmental stewardship in the workplace – from paper, plastics and electronic waste in the office to larger initiatives to eliminate harmful emissions or chemicals in the supply chain.
- Work to bridge the gender and diversity gaps in my business by hiring, promoting or mentoring diverse colleagues.
- Encourage my company to engage in public-private partnerships to achieve the SDGs and realize a vision for a more sustainable and inclusive world.