Whatever size your business is, ESG (environmental, social and governance) is becoming increasingly important. Contributors to this include the climate emergency, the broad range of societal needs and an unfortunate decrease in ethical behaviour and conduct.
Think for a moment about the environmental challenges. They include the impact of global climate deterioration, rapid depletion of natural resources and water scarcity, including pollution of streams, rivers and the ocean. Waste is another growing concern as a consumer-led society propelled by internet e-commerce requires more and more materials for goods and packaging.
The societal factors include human rights, labour practices and responses to community development.
Governance includes a whole range of good practice, ethical behaviour, rules of conduct, legislation and regulations.
What is required to manage all these important factors in a business including small businesses?
There needs to be an understanding of the ESG factors and requirements as a starting point. Someone in your business should be given the responsibility to manage and the ESG factors and ensure that not only is your business compliant but that to gain competitive advantage your business seeks excellence in ESG.
The qualities of the person managing ESG factors is firstly a good administrator who has an excellent grasp of details, is a systems thinker and can use systemic thinking to “connect the dots” and dig deep into material impacts and come up with workable solutions.
The other important thing is that your ESG administrator/manager has an excellent understanding of your business and its operations. Business and industrial experience counts because a knowledge of operations is essential. You need someone who doesn’t merely provide a register of the legislation and other requirements but a person that is proactive and can effectively manage the projects and processes that will be required to ensure compliance and good practice.
Important characteristics of a good ESG manager and administrator are communication at various levels and with various institutions and bodies as well as deep analytical thinking skills.
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