At BDO, we view sustainability through the universally recognised ESG framework - that is, environmental, social and governance matters. Using the ESG framework helps to unpack the wide-ranging risks and metrics that fall under the term ‘sustainability’. ESG cuts across the functions of a business to assess how an organisation manages risks and creates long-term value.

Why is ESG important?

This global sustainability movement is becoming critical as part of a business’ social licence to trade. Businesses that fail to act in this space risk potential impacts on their reputation, market opportunities, and even employee value proposition.

A focus on ESG can do more than just meet growing stakeholder demands. Savvy boards are also recognising the broader business benefits, including the potential to create and sustain long-term value through:

• Corporate reputation – ESG can enhance a company’s license to operate making it easier to accomplish business objectives and respond to crisis scenarios with key stakeholder groups.
• Risk reduction – ESG can assist with the identification of immediate and long-term risks depending on the industry and business model.
• Opportunity management – Shifting market and non-market conditions can expose unmet needs for new products and/or services, potential customer bases, and potential strategic relationships for addressing ESG issues.
• Culture and intrinsic values – ESG maturity is an indicator of a company’s commitment to building a high-performing, purpose-driven workforce and inclusive culture.

How BDO can help

You’ll find a range of resources to help you understand more about ESG or help you start your sustainability journey in our learning hub, or you can reach out to one of our sustainability experts today.