ESG 2.0 – From Defense to Offense
By Eduardo Mercado Millones
Panelists:
Tim Hill, Head of Americas Stakeholder Engagement, OMRON Corporation (Tokyo: 6645)
Jonathan Hirschtritt, Managing Director, Sustainability, GCM Grosvenor (Nasdaq: GCMG)
Michael Wanta, Manager, ESG and Corporate Communications, Telephone & Data Systems Inc. (NYSE: TDS)
Moderator: John Coons, Retired JPMorgan Chase Executive, Midwest Global Corporate Banking
KEY TAKEAWAYS
- Moderator John Coons opened the panel by highlighting four discussion topics: shareholder versus stakeholder capitalism; how best to tell a company’s environmental, social and governance (ESG) story; ESG as a way to attract human capital, and the impact of communities on ESG strategies to attract long-term investors, create corporate value and contribute to positive change in the world.
- Jonathan Hirschtritt said that when it comes to ESG, it is fundamental for companies to educate all its stakeholders on ESG goals, explain progress and back up these statements with supporting data. One challenge is finding the right balance between communicating with local versus global communities. As an investor, GCM Grosvenor assesses the potential impact of ESG factors on investment risk and opportunities, including the tangible, bottom-line impact. The firm separates “universal” key performance indicators (e.g., diversity) from “custom” KPIs that can add value that is specific to a company and/or industry (e.g., the supply chain).
- Michael Wanta highlighted the importance of clarifying a company’s purpose to drive its ESG story. Companies should use benchmarks to identify improvement opportunities and data to strengthen the narrative. TDS has found ESG conversations to be an excellent opportunity to gain attention from investors, improve the company’s overall credibility, attract a new generation of talent and engage in powerful conversations with communities.
- Tim Hill argued that companies need a long-term ESG vision that includes developing collaborative relationships with multiple stakeholders, rather than focusing solely on investor capitalism. Companies can drive their ESG narratives by proactively setting non-financial goals and communicating their ESG achievements. This way, stakeholders – including prospective employees – will believe in the company’s commitment to its ESG goals. OMNRON proactively communicates its ESG vision, priorities and progress via periodic ESG briefings and Behind Our Numbers podcast on Shaping the Future and IR Insights.