ESG business strategy is driven by customers today as it was before the importance of climate change became ubiquitous.
A business succeeds when customers patronize it. It is therefore imperative for a company to have customer-focused strategies. Climate change is now recognized as one of the most serious crises that the world has faced since its existence. According to Inter-Governmental Panel for Climate Change projections, we will see global average temperatures 2.6 to 4.8 degrees Celsius higher than the present by this century. Sea levels will also be 0.45 to 0.82 meters higher than today.
Climate change is impacting human existence like never before. Agriculture, for instance, is extremely vulnerable to increasing temperatures, weather variability, shifting agroecosystem boundaries, invasive crops and pests, and more frequent extreme weather events.
These weather events will reduce crop yields, harm the nutritional quality of major cereals, and lower livestock productivity.
As customers worldwide are becoming more aware of the impact of climate change on their lives, they want companies, governments, and others to reduce their carbon footprint in their operations. Customer pressure has gotten to investors who have mainstreamed climate risks into their lending models. A business is now obliged to mainstream climate-friendly practices into its operations. Capital is now becoming green. You will not be able to secure capital if you ignore these facts.
Customers also want businesses to be gender-sensitive and have equitable racial, religious, and gender policies.
Ethical governance is also now imperative. Customers are shunning companies with an honest questionable record of governance. ESG is a business imperative. A company ignores it at its peril.