Oxford Business Group (OBG) has launched a survey assessing the observations of international C-suite executives on a broad range of issues related to environmental, social and governance (ESG) principles, including the impact of the pandemic.
Titled Renewed focus: How the Covid-19 pandemic shaped priorities around ESG principles, this marks the first time the landmark survey has focused on ESG. Results comprise more than 350 respondents from across the regions covered by OBG, with questions concerning their current approach to ESG and incumbent challenges to growth.
In its research, OBG surveyed executives based across the economic sectors, with financial services and energy highest in terms of representation.
The findings are supported by in-depth analysis from OBGs Editor-in-Chief Oliver Cornock and the firms four Regional Editors, who explore the specific characteristics of the markets they cover and track their ESG journeys.
Significantly, more than 60% of global respondents said the pandemic had moderately or significantly impacted their understanding and/or appetite for ESG, in a sign that the health crisis had spotlighted vulnerabilities in supply chains and other areas, and encouraged companies to put sustainability at the heart of new strategies.
In his contribution, Patrick Cooke, OBGs Regional Editor for the Middle East, said that the governments of all six GCC members have, to varying degrees, formulated their long-term strategies to diversify their economies, reduce public subsidies and stimulate the creation of productive and attractive job opportunities in the private sector.
It is positive to note that these strategies have increasingly placed an emphasis on environmental sustainability, social progress and good governance as they have evolved over time, he said. I expect to see further acceleration of corporate ESG adoption in the region over the next few years as a result of public incentives, new regulatory requirements and the growing importance that international investors place on ESG adherence.
In a question about obstacles to ESG adherence, respondents cited insufficient financing and incentives or penalties for non-compliance, was cited as the biggest challenge faced by companies, garnering 20.4% of the response.
OBG also asked executives about their priorities for environmental sustainability over the next 12 months. Here, sustainable investment took the top spot, cited by 22% of interviewees, followed by renewable energy (19%).
In a sign of the increased broad-based focus on ESG, more than one-third (35%) of those interviewed said they expected their company to prioritise funding for all-three pillars, although governance was mentioned least often as an individual area.
Oliver Cornock, OBGs Editor-in-Chief, said that while the Covid-19 pandemic could have resulted in the adoption of ESG principles being sidelined, the opposite had in fact happened, as the survey showed.
Shareholders and investors are now factoring ESG strategy and trajectory into their decision-making, and consumers are similarly becoming more aware of the fairness and sustainability of the goods they use, the clothes they wear and the services they pay for, he said. This is equally true for foreign investors who are looking at the ESG environment, regulations and incentives of the countries in which they are considering doing business.
Cornock said OBGs survey also reaffirmed that while the battle for environmental sustainability was being won on many levels, the relatively low showing for governance represented a challenge for some of the emerging markets looking to attract foreign investment.
The tacit acceptance that corruption is simply a part of doing business in some places is one of the most significant barriers to advancing the governance segment, he noted. Progress in the environmental sustainability and social spheres cannot reach its full potential until the correct governance structures are in place and effectively enforced.
Cornocks viewpoint can be found in full on OBGs Editors Blog, alongside additional analysis by all of OBGs Regional Editors on the markets that they cover. Titled Next Frontier, the blog serves as a platform for OBGs experts to share their thoughts on the latest developments taking place across the sectors of the 30+ high-growth markets covered by the companys research. TradeArabia News Service
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