From the stockholder to the stakeholder
From the Stockholder to the Stakeholder by The Smith School of Enterprise and the Environment at Oxford University is an excellent review of academic and other research relating to “how sustainability can drive financial outperformance”. It is authored by Gordon Clark, Andreas Feiner and Michael Viehs, who clearly and comprehensively set out the business case for environmental, social and corporate governance (ESG) factors.
From the Stockholder to the Stakeholder shows how well managed ESG factors lead to improved performance in risk management, operational performance and enhanced corporate reputation. It shows how sustainable corporate practices lead to decreased cost of capital, both debt and equity, and also how managing ESG well leads to a positive impact on stock prices.
Standards & Legal welcomes this research.
Improving ESG performance to maintain and create value
There are various things that companies can do, both in the short term and the long term that will improve the performance of ESG factors. Some practices add competitive advantage (for example, innovative waste management practices may reduce waste disposal costs and the costs of raw materials). Other practices decrease competitive disadvantage (such as penalties for non-compliance with environmental or health and safety laws or repetitional damage for environmental breaches).
Whether you are seeking to increase competitive advantage, or decrease competitive disadvantage, all employees, at all levels, need to know exactly what it is that they have to do for any given aspect of operations.
There is a lot of complexity that needs to be simplified. The regulatory environment is increasingly becoming more and more complex with law constantly changing and penalties increasing. For example, UK courts have recently held that penalties of up to 100% of a company’s profits are appropriate for environmental breaches. Then there is the complexity of what is required to be done in order to go from merely being legally compliant (which is not always simple thing) to innovating sustainably profitably practices.
The Standards & Legal Platform
The Standards & Legal Platform caters for both. It is a site specific or operation specific platform that enables employees at all levels to manage ESG factors well, and to know exactly what they need to do for any given aspect of operations.
From the law, to other legal requirement (imposed by contract for example), to other obligations (such us those standards voluntarily adopted), to standard operating procedures of the company, to knowing the best innovative practices identified by the company, the Standards & Legal Platform allows one touch access to relevant “obligation information”. It does this for any given aspect of operations according to an employees point in time need. Because of this agility and precision in providing only relevant legal and other information, the Standards & Legal Platform integrates powerfully with management systems. Contact us if you would like a demonstration as to how the Standards & Legal Platform may assist your company to improve its ESG performance and thereby improve its financial performance.