The Planet Will Be Fine

Reflecting on the Purpose of ESG

By: Blythe Butler

The planet will be fine. One way or another, this amazing place called earth will continue its ecological adaptation for many more billions of years. The question is only if humans will remain, and the level of suffering we'll endure to earn the right to stay here. As Mark Carney recently stated, ‘Net zero isn’t a slogan, it's an imperative of climate physics’. You know, the same physics underpinning human survival.

 The current Environmental, Social and Governance (ESG) movement can get us to both ecological and social justice, if we do it right. The historical trajectory of Corporate Social Responsibility (CSR) has a lot to tell us about how we can truly use this movement to fuel (pun intended) change; or develop yet another intricate system to report on without fundamentally changing much. Don’t get me wrong: we have made huge progress in CSR. Thousands of corporations changed their practices for the better. And yet: income equality, diversity, access to healthcare, wealth gaps, environmental abuse, racism are all issues that continue to impact organizations and society in general.

 The ESG movement feels different this time. The shift in global financial assets toward ESG investments means the materiality of ESG is being embedded in core business valuation in ways it hasn't before. Increasing pressure to capture value for stakeholders, not just shareholders, is underway. New ways of valuing human values are being embedded in global systems.

 And yet I worry. I worry our focus on the 'E' of ESG may hoop us in the end. When I hear the term ESG being used as a broad statement of a company's approach without mention of 'S' or 'G', I start to have visions of the promise of ESG being diluted to the point of obscurity: the ESG train heading off into the sunset and most of us standing on the platform with our ticket in hand. Train gone, ticket worthless. Another green washing - with trillions of dollars behind it.

 We can get to Net Zero by 2030 and avoid untold human suffering. We can price carbon and develop new innovations that just might save our butts. We can do all that and still have income inequality, sick people, kids without access to clean water, lack of healthcare, mental health crises, housing shortages, domestic violence, racism. The list is longer, as you know.

 So, what about the S and G? The whole reason we are undertaking ESG is for the 'S': improving the health, wellbeing, resilience and thriving of human communities, in the context of a healthy ecological system. A good E story for the sake of E improvements doesn't go far enough. We will be here in 8.5 years celebrating that global temperatures have only risen to 1.5C, with no change in social progress. We will have steered the ship and avoided the iceberg, but access to the fancy dining room will still only be for the VIPs. And there will still be people down in the hull suffering for minimum wage, grating the carrots and cleaning the dishes. They shouldn’t suffer so that the rest of us can eat.

 So. Let's help corporations and governments make it to net zero. Let's help them make gazillions while doing it. And lets ensure we don't leave the S and G behind while doing so: climate justice and social justice are inextricably connected. Policy makers have a huge opportunity to level the playing field and use ESG to create value for society and help corporations get there faster.

 In the early days of COVID during the social justice movements that spread across the globe I saw a meme that said “Equal Rights For Others Does Not Mean Less Rights For You. It’s Not Pie”.

 The S & G of ESG aren’t pie either: the better we do on S & G not only in corporations or global finance, but in institutional policy and local communities, the better chance we have of actually enjoying the innovation and ingenuity we've invested in advancing the 'E'. I don't see what is so evil about helping a fellow human being live a better life. The only way that sucks is if we believe our personal well-being is going to be diminished by doing so. What a small, petty thought.

 We have such an incredible opportunity in front of us: we can build back better and ESG can help us get there as long as we remember it’s fundamentally about the people on the pale blue dot we call home.

 Blythe is the Chief Impact Officer for Gaia Protein. She is the founder of Atticus Insights and has a broad and diverse background in social impact, change management, social network analysis, strategy, facilitation and collaborative governance.  Over the past 20 years she has worked in the public, private and not-for-profit sectors, consulting with clients in a variety of topics ranging from Network Governance, ISO Quality Management, Process Safety Culture, Sustainability and Corporate Social Responsibility measurement & reporting and social impact. Blythe is an accomplished facilitator and stakeholder engagement practitioner. She holds a certificate in Sustainable Business Strategy from Harvard Business School (virtual), is a certified PROSCI Change Management practitioner, holds a BCom in Finance and International Development from University of Alberta, studied Journalism at Carleton University, and Design Marketing at Parsons in New York City. Blythe is a member of Calgary’s 'Top 40 Under 40' for her career and community contributions.