Yugen Naidoo, General Manger of Lenovo Southern Africa 

ESG stands for Environmental, Social and Governance, three related but distinct issues that have been broadly recognised as drivers of long-term business value. ESG is now recognised as a key strategic priority by institutional investors and fund managers because of the impact it has on business and financial performance. ESG is a hot topic on which many well-publicised resolutions have been passed but are often ineffective. In order to make real and lasting change, the ESG movement will need to move beyond the superficialities of policies and resolutions and develop practical strategies that can be put into place.

The first step towards understanding ESG is to recognise that it is more than just risk, and to appreciate the role it plays in business performance. Environmental and social risks are incorporated into all financial calculations today, but they are often not treated as strategic requirements. If a company’s business model is dependent on environmental damage or human rights abuses, it is unlikely to be sustainable. ESG has to be integrated into every part of the business, from investing in capital projects to launching new products and marketing them. 

Incorporating ESG sustainability into business strategy

Your businesses ESG practices are not the concern of leadership, investors, and board members alone but rather, a collective effort. If prioritised efficiently, it can be a great asset in bringing and retaining the best talent into a company.

Endorsing ESG in the workplace can improve employee productivity and wellbeing, maintain a healthy working environment for employees and help build the business’ reputation. That, in turn, will help you reinforce your ESG strategy and help you drive business growth.

But why does ESG matter? 

Designing a stringent policy can assist in cementing accountability for helping the business achieve its targets, while improving reporting on its ESG efforts. To do this, a business needs to formulate a roadmap that indicates its ESG strategy, fitting it into its existing business strategy. It’s important that the roadmap clearly states the business’ key priorities which should be both actionable and measurable.  

Integrating your ESG initiatives into your business strategy, and through every phase of your operations will ultimately help decision-makers, to evaluate risks and make informed choices that help move the business forward.    

Communicate and have your employees partake in the business’ vision

The workplace is increasingly becoming infiltrated with millennials, who are anticipated to make up 75% of the workforce by 2030. This generation is value driven and when it comes to their work, they don’t only look for work-life balance, but an environment that values ethics. 

To improve the business’ social responsibility performance and drive employee engagement in the business, it’s vital that you put employees in the forefront of your ESG initiatives. A good place to start is to create a just and transparent business environment. 

Secondly, following COVID, many businesses have adopted a hybrid working model, which has proved to be effective over the years. Employees are finding that they are more productive at home and have suggested that it is better for mental health. Providing your employees with flexibility to choose how and where they would like to work, will not only reduce your company’s environmental impact but lead to more self-sufficient employees.  

While you invest in ensuring that employees thrive while working from home, ensure the same for the work environment in office. The business needs to certify that the office is safe, there are programmes and guidelines that speak to mental health and wellness and that your workstations, resources, and tools are in a position that enables workers to be productive. 

Extend sustainability practices to the greater community

To achieve great success in the business’s sustainability practices, it is not only the business, employees or decision makers that can benefit from ESG initiatives. The local community in which you operate, should be a part of it. Lenovo has philanthropic investment in communities around the world. Through devices and funds for communities around the world, the company has provided smarter technology for all, by providing unprivileged communities with access to technology and STEM education. Through its outreach programmes, Lenovo anticipates reaching millions of individuals by 2025. 

Driving business value, now and in future 

The importance of accounting for and embracing ESG factors as part of a framework for sustainability is critical for all organisations. As the world and business landscape transitions around you, ensure that your business redirects and revaluates its approach to ESG, in aim of enhancing and retaining the value.  The better prepared you are in your ESG movements and initiatives, the more likely you will be to mitigate potential risks, that can negatively impact the business.