Environmental, social and governance (ESG) factors are becoming more visible and impactful, according to research firm McLean & Company. The firm found that each organization’s success relies should no longer be measured solely by financial performance, but also business they contribute to a sustainable and equitable future.
As a result, the firm believes it’s important for company leaders and HR teams to thoroughly understand and implement ESG programs. In fact, the company said, HR’s role can be critical to these programs’ success because of the ability to align them to company goals.
“The need for ESG programs continues to grow,” said the company. “This means that organizational and HR leaders must have a thorough understanding of ESG, its importance to shareholders, and its impacts on both internal and external stakeholders. ESG programs and initiatives must be implemented deliberately and with purpose or risk appearing as performative or ineffective.”
Values and Purpose
According to the McLean & Company research, fiduciary duty to shareholders, the visibility of climate change, greater awareness of social issues and the recent emphasis by regulators on board accountability have driven organizations to adopt ESG programs.
In addition, the firm showed that ESG initiatives help employees to “feel connected to a greater purpose” at work. The firm advised tying “ESG programs to the organization’s purpose and creating a narrative for employees.
“The responsibility o
Environmental, social and governance (ESG) factors are becoming more visible and impactful, according to research firm McLean & Company. The firm found that each organization’s success relies should no longer be measured solely by financial performance, but also business they contribute to a sustainable and equitable future.
As a result, the firm believes it’s important for company leaders and HR teams to thoroughly understand and implement ESG programs. In fact, the company said, HR’s role can be critical to these programs’ success because of the ability to align them to company goals.
“The need for ESG programs continues to grow,” said the company. “This means that organizational and HR leaders must have a thorough understanding of ESG, its importance to shareholders, and its impacts on both internal and external stakeholders. ESG programs and initiatives must be implemented deliberately and with purpose or risk appearing as performative or ineffective.”
Values and Purpose
According to the McLean & Company research, fiduciary duty to shareholders, the visibility of climate change, greater awareness of social issues and the recent emphasis by regulators on board accountability have driven organizations to adopt ESG programs.
In addition, the firm showed that ESG initiatives help employees to “feel connected to a greater purpose” at work. The firm advised tying “ESG programs to the organization’s purpose and creating a narrative for employees.
The responsibility of ensuring alignment with the organization’s core values and socializing the narrative internally rests with HR. Building an intentional narrative creates an interwoven organizational story that establishes values and initiatives, connecting everyone to one purpose,” said LeeAnn Brewer, the company’s director of HR & Advisory Services.
Image: McLean & Co.
