We’ve apparently reached an inflection point with the development and execution of Environmental, Social, and Governance (ESG) corporate policies. The role of business leadership in sustainability issues around climate change has received increasing attention from companies and their key stakeholders.
But over the past year, something changed for CEOs worldwide, and sustainability talk turned into action. Continued disruption -- including upheaval and disruptions from the global COVID-19 pandemic -- has society at large calling for a new approach to economic advancement and business priorities.
According to a recent survey by Oxford Economics, when it comes to optimizing opportunities and delivering business value, some CEOs have discovered an additional step. These savvy CEOs report deliberately integrating their Sustainability and Digital Transformation efforts.
Digital Transformation and ESG Drive Growth
For organizations with a clearly defined sustainability strategy and the right capabilities in place, this alignment is unlocking commercial performance benefits -- up to 41 percent higher revenue growth.
The most forward-thinking CEOs see government ESG mandates as an opportunity, whereas others merely see the operational cost. From the strategies they embrace, the stakeholders they engage, and the digital capabilities they can leverage, leading CEOs imagine growth that will positively impact their enterprise.
Almost half of the CEOs surveyed said increasing sustainability is one of the highest priorities for their organization in the next 2 to 3 years -- that's up from roughly a third in 2021, or an increase of 37 percent in just a year.
Exploring ESG Global Market Trends
According to a recent Bloomberg Intelligence market study, global ESG assets surpassed $35 trillion in 2020 and are on track to exceed $41 trillion by 2022 and $50 trillion by 2025 -- one-third of the projected $140 trillion in total assets under management globally.