Thank you- what occurs to me is a need for meaning and understanding of transformational as a word. I look forward to your future thinking as to how to enable shared meaning and consequently shared action to co-created transformation
This comment from Maurizio Zollo went onto LinkedIn, which I shall repost here:
Maurizio ZolloMaurizio Zollo
Founder/Director, Leonardo Centre on Business for Society at Imperial College London
Thank you, John Elkington, for this lucid reflection on the Leonardo Centre on Business for Society's latest report "Which sustainability actions boost shareholder returns and which hinder them?".
You are absolutely right, of course, this new approach, based on the systematic assessment of corporate sustainability actions, allows us to go beyond the current ESG ratings and indeed identify the transformational actions (innovations, change, value chain cooperation) that generate a very large alpha for investors, vis-a-vis all the other actions that don't.
Moreover, it explains why the evidence on the correlation between ESG ratings and firm performance is so elusive to find. They are simply rewarding risk minimization actions (impact measurement, HR training, etc.) which are at best preparatory for value creation, but do not generate value per se. That is what ESG ratings were created for, minimizing investors' risks, and that is what they deliver.
To assess companies' capabilities to generate synergies between impact and profit, we need to look beyond ESG and focus on truly transformative actions. Our dataset, currently covers 1.8 million actions in 75000 reports by 18,000 companies across 86 countries, is a solid basis to move the global conversation on what really matters for companies, beyond the (important but insufficient) moral and compliance elements.
Thank you, John, for helping people begin to see the economic value of the transformational mindset. Seeing the need for this mindset … because of the risks we face as the current, dysfunctional sociopolitical economic system drives humanity off the sustainability-avoidance cliff … and the benefits to be realized when cooperation and love (including cooperation with Mother Nature and love of learning) become the foundational values of society … is the highest priority I can think of for the future educational efforts aimed at business leaders (but also leaders in other sectors)! We must separate the business world from Wall Street’s demand for higher and higher quarterly profits. I think the case you’re beginning to make can help achieve that goal. Quarterly profits (and the corrupt actions they encourage) are killing us! We need long-term thinking!
Thank you- what occurs to me is a need for meaning and understanding of transformational as a word. I look forward to your future thinking as to how to enable shared meaning and consequently shared action to co-created transformation
This comment from Maurizio Zollo went onto LinkedIn, which I shall repost here:
Maurizio ZolloMaurizio Zollo
Founder/Director, Leonardo Centre on Business for Society at Imperial College London
Thank you, John Elkington, for this lucid reflection on the Leonardo Centre on Business for Society's latest report "Which sustainability actions boost shareholder returns and which hinder them?".
You are absolutely right, of course, this new approach, based on the systematic assessment of corporate sustainability actions, allows us to go beyond the current ESG ratings and indeed identify the transformational actions (innovations, change, value chain cooperation) that generate a very large alpha for investors, vis-a-vis all the other actions that don't.
Moreover, it explains why the evidence on the correlation between ESG ratings and firm performance is so elusive to find. They are simply rewarding risk minimization actions (impact measurement, HR training, etc.) which are at best preparatory for value creation, but do not generate value per se. That is what ESG ratings were created for, minimizing investors' risks, and that is what they deliver.
To assess companies' capabilities to generate synergies between impact and profit, we need to look beyond ESG and focus on truly transformative actions. Our dataset, currently covers 1.8 million actions in 75000 reports by 18,000 companies across 86 countries, is a solid basis to move the global conversation on what really matters for companies, beyond the (important but insufficient) moral and compliance elements.
Thank you, John, for helping people begin to see the economic value of the transformational mindset. Seeing the need for this mindset … because of the risks we face as the current, dysfunctional sociopolitical economic system drives humanity off the sustainability-avoidance cliff … and the benefits to be realized when cooperation and love (including cooperation with Mother Nature and love of learning) become the foundational values of society … is the highest priority I can think of for the future educational efforts aimed at business leaders (but also leaders in other sectors)! We must separate the business world from Wall Street’s demand for higher and higher quarterly profits. I think the case you’re beginning to make can help achieve that goal. Quarterly profits (and the corrupt actions they encourage) are killing us! We need long-term thinking!