How corporate leaders can apply ESG tools to help overcome global challenges

SourceWorld Economic Forum
CountryMiddle east

Stakeholder capitalism - ensuring that business serves society at large - has been on the rise during the COVID-19 pandemic. A new World Economic Forum report outlines how to create governance frameworks for environmental, social and governance (ESG) standards. The recommendations cover purpose, strategy, board composition and more. The gradual pace of social progress is occasionally punctuated by periods of rapid change. We are undoubtedly amid one of these shifts, as pandemic, climate risks, and economic and racial inequality test society’s resilience – and rapidly force new ways of operating. These shifts are increasingly apparent in the business world, where businesses are adapting by integrating stakeholder outcomes into their business models. “Stakeholder capitalism” has made headlines over the past 18 months as the World Economic Forum, the Business Roundtable and others have called on corporate leaders to include the voice of stakeholders in their decision making.

The rise of stakeholder capitalism In response, many corporate leaders are seeking to refocus the purpose of business. For example, the US Business Roundtable changed its statement on the purpose of a corporation in August 2019 to commit to promote “an Economy that serves all Americans”. In addition, the world’s largest investors, including more...