Strategic Impact Assessment


A brave new world for ESG    

Strategic Impact Assessment

Sustainability initiatives are often driven by statutory requirements, but these can also obscure the strategic business advantages of thinking outside the regulatory box.

Taking aim

Although many companies are now responding to their statutory obligations on sustainability – such as environmental, social and corporate governance (ESG) reporting – this gains them little more than compliance: simply getting over a raised bar, rather than reaching for the stars. Policy agendas and regulations are slow to develop, and often lag behind social awareness and expectations, so a business that demonstrably thinks and acts independently will stand out from those that simply jump through hoops. You might know your carbon emissions, but do you also know what the benefits are of reducing those emissions for communities they affect, the value of risk reduction from avoiding upcoming regulations, and the effect of lower energy costs? Rather than simply disclosing information, are you examining it more closely to understand what it really means for the world, and your business?

Strategic Impact Assessment

Taking a stand

Although sustainability regulations can offer prescribed routes to compliance, they can also pull focus away from the broader question of how an organisation’s own values and purpose in the world are articulated and exercised, and how they relate to the planetary boundaries and social floors. When ESG requirements are shouldered by one officer or department – and separated from core business interests – it’s hard to make sure the ethos underpins all thinking and action at the company, and throughout the value chain.

Taking a lead

There’s a pragmatic business case for having a clear and well-calibrated moral compass. The best talent now emerging from education will be alert to, and favour, employers that reflect the spirit, rather than simply the letter, of their own values. Customers who want themselves or their children to live in a better world might choose products, services and brands that embody their vision; while shareholders and stakeholders are increasingly alert to such market demands. Longer-term, a well-developed strategy for sustainability will represent a more stable proposition for investors, and help future-proof a business.

Taking interest

For more than a decade, we’ve been curious about how organisations can measure their impacts on the world holistically; find a common language through which such impacts can inform strategy, decisions and planning; and monitor and communicate the impact they make both internally and externally. In the next blog in this series, we’ll share our thinking about how to make the holistic measurable.

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