No government or state had thought about climate change in their governance model. U.S. Army chief climate researcher Jeff Arnold believes it is about time that companies incorporated the ESG model. In this article at Forbes, Michael Gale shares what made organizations include climate change in their governance model.
Climate Change and Governance
Four factors—“Raw processing power, a new generational focus, commercial interests, and pure evidence”—were enough to uphold the ESG model. Here is more in-depth detail behind adding climate change to the governance model:
Strong Computing Models
Amazon and Google have provided a massive amount of data available to scientists. They can leverage the information to create persuasive, scalable, and futuristic climate change models that were not possible before. The confirmed statistics and predictions persuaded communities to take more steps towards a sustainable business framework.
Millennials, along with Gen X customers, became the largest customer base in recent years. Gen Zers, too, pressured companies to reconsider how they ran their businesses. Organizations had to take responsibility for their actions due to multi-generational pressure.
Recent droughts, famines, and so on provided legitimacy to the climate change claims that companies ignored before. The data-based models proved that 30 to 50 percent of Californian droughts from 2014 are because of human-made environmental issues. Furthermore, what once was once-in-a-lifetime phenomenon is happening more frequently, like the recent pandemic.
Salesforce, Accenture, McKinsey, and KPMG are the frontrunners in bridging the gap between commercial benefits and reducing climatic issues. New services are coming up to help organizations lower climate change risks like carbon footprints. Climate talks are no longer isolated to the scientific community but are a part of the business dialog for various organizations. To make it effective, governments across the world have created 1,000 different environmental and climate-based laws. According to World Economic Forum, 86 percent of the business leaders believe ESG discussions are beneficial for all companies and industries.
To view the original article in full, visit the following link: https://www.forbes.com/sites/worldeconomicforum/2021/01/13/how-corporate-leaders-can-apply-esg-tools-to-help-overcome-global-challenges/?sh=165bfea15de1