Just a few weeks ago corporations were preparing hard for the AGM season and, with it, some rigorous questioning from shareholders on their environmental, social and governance (ESG) performance. In the social bracket, investors’ concerns around gender diversity on boards and executive pay and pensions were set to top the bill, while environmental proposals largely addressed companies’ efforts to combat climate change and set carbon emissions targets in the wake of broader commitments to honour the 2015 Paris Agreement.
But the onset of the Covid-19 pandemic in March has seen firms cast into uncharted waters. Several have had to shed jobs or may even face bankruptcy. Others have furloughed staff and rapidly reconfigured their supply chains whilst trying to protect the health of frontline workers or establish new ways of working remotely.
ESG, as a non-market force, has risen sharply up the investor and corporate agenda in just a few years and while some predicted that the Covid-19 pandemic could curtail that momentum, the last few weeks has shown the opposite to be true; in order to weather this crisis and maintain their societal responsibilities, companies have had to further sharpen their focus on ESG.
Firms have not just had to adapt quickly but have had to cope with unprecedented levels of public scrutiny of how they are mitigating the negative effects of the pandemic, particularly on their employees, contractors, customers, and suppliers.
