Monthly Archives: April 2021

Corporate Sustainability – A Converging Opportunity to Simultaneously Reduce Carbon Emissions and Optimize Multi-Tier Supply Chain Risk?

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April 2021

by Pam Styles – Fellow, G&A Institute and Principal & Founder of Next Level Investor Relations LLC

There may be a converging opportunity for companies to accelerate total carbon emissions reductions (Scopes 1, 2 and 3) in collaboration with critical efforts to better understand and mitigate multi-tier supply chain risks that were revealed by the COVID-19 pandemic.

Expansive coverage of emerging trends supporting this thesis is presented in the Resource Paper, The Carbon Key: Transcending ESG Disclosure Frameworks Consolidation and Accelerating Supply Chain Awareness, newly published on the Governance & Accountability Institute website.

HIGHTLIGHTS

✔  A noticeable increase in the number of new articles combining observations about CO2 and supply chain, including articles from the World Economic Forum, The Wall Street Journal and CDP, formerly known as the Carbon Disclosure Project.

✔  Articles supporting the idea that conditions may already exist for the commercial business sector to make real and lasting emissions reductions on its own – sooner and better – than to wait for geo-political negotiations and distant reduction target dates.

✔  Introduction to complementary opportunities for individual companies and the commercial business sector to focus on supply chain CO2 contributors and reductions that are material.

✔  A challenge to imagine if carbon emissions disclosure and performance tracking were prerequisites to resume sourcing from pre-Covid suppliers.

Thinking of these trends from an Investor Relations and ESG communications vantage, with some rudimentary optimization modeling exposure, it is suddenly compelling to take a look at Scope 3.

SCOPE 3 – “THE CARBON KEY”

Scope 3 CO2 emissions include both upstream and downstream categories.

Using guidelines published by the Global Reporting Initiative (GRI) for layman’s interpretation, Scope 1 (direct) and Scope 2 (indirect) CO2 emissions are defined as coming from sources owned or controlled by an organization; Scope 3 CO2 emissions are a consequence of an organization’s activities, but occur from sources not owned or controlled by the organization.

An excerpt from the Scope 3 guidelines points to, “The reporting organization can identify other indirect (Scope 3) emissions by assessing which of its activities’ emissions… contribute to climate change-related risks, such as financial, regulatory, supply chain, product and customer … “

Upstream categories, at least the first four listed below, could be constructive additions to supply chain optimization models. In this way, companies could assess Scope 3 emissions improvement performance indicators for each potential supplier in a similar way as cost inputs are compared for low-cost sourcing optimization in supply chain modeling and actual procurement decision-making.

SCOPE 3 – CO2 EMISSIONS

Upstream categories

Downstream categories

1. Purchased goods and services

1. Downstream transportation and distribution

2. Capital goods

2. Processing of sold products

3. Fuel- and energy-related activities (not included in Scope 1 or Scope 2)

3. Use of sold products

4. Upstream transportation and distribution

4. End-of-life treatment of sold products

5. Waste generated in operations

5. Downstream leased assets

6. Business travel

6. Franchises

7. Employee commuting

7. Investments

8. Upstream leased assets

Other downstream

Other upstream

 

Source: Global Reporting Initiative Standards GRI KPI 305 – Emissions

CONTEMPLATE & CONSIDER
The Carbon Key article introduces several questions and things to contemplate:

  1. How might companies quickly re-evaluate their supply chain optimization decisions in the immediate post-Covid recovery?

  2. Imagine how different management decisions might be if all layers of CO2 emissions were factored into the total cost of ownership (TCO) in supply chain decisions and risk mitigation.

  3. Notice similarities between companies’ struggle to capture and report Scope 3 CO2 emissions and of supply chain tiers mapping challenges.

    A recent study found, that while 91% of companies can identify the physical location of most or all of their Tier 1 supplier facilities, only 17% could do so of their Tier 3 supplier facilities.

  4. Companies’ leadership and understanding of its complete carbon footprint may be rapidly put to the test as capital markets and respective raters’ increase their attention on this issue.


The ESG/Sustainability field has been quietly maturing in the business sector, while the U.S. and global government sector has been distracted by the pandemic.

✔  The latest annual trends tracking conducted by the Governance & Accountability Institute shows 90% of S&P 500 and 65% of Russell 1000 companies produced sustainability reports as of 2019.

✔  In September 2020, five of the most globally recognized ESG voluntary reporting frameworks – GRI – CDP – SASB – IIRC – TCFD – announced they have pledged to work together in harmonizing ESG framework guidelines.

✔  As these five entities attempt to harmonize guidelines, other entities and collaborations have recently announced development of new ESG disclosure frameworks, i.e., CFA, the Big Four accounting firms, International Business Council (IBC).

✔  ESG-related data suppliers and aggregators continue to assert influence with frequent announcements of new ESG ratings and syndication arrangements to meet the growing information demand.

✔  Carbon emissions is one topic that transcends differences across most of the major voluntary ESG reporting frameworks. No matter which framework guideline(s) a company chooses to use, Scope 1, 2, or 3 CO2 emissions guidelines generally refer to the globally accepted methodology referred to as the Greenhouse Gas (GHG) Protocol. The carbon key can unlock interconnections to aid ESG framework harmonization.

CLOSING THOUGHTS
Talk to each other! Forget about internal silos and collaborate between teams.

There is every reason to believe that company experts can look at the carbon key to find faster, focused and efficient ways to mesh two seemingly different challenges – supply chain tiers risk and Scope 3 CO2 emissions reduction – for optimization that delivers real return on investment.


Pamela Styles – Fellow, G&A Institute – is Principal and Founder of Next Level Investor Relations LLC, a strategic consultancy with dual Investor Relations and ESG / Sustainability specialties.

 

Overview: Select Sessions, “SB21” Trendwatching – Mapping the New Brand Purpose Landscape

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April 2021

by Kirstie Dabbs – G&A Institute Sustainability Reports Analyst and G&A Sustainability Analyst Intern Team Leader

BACKGROUND
Sustainable Brands hosted its “SB ’21 Trend Watching“ event (virtually) on February 23, 2021. Covering the intersecting crises from 2020 and opportunities that lie ahead for stakeholders in 2021, the event was full of information about the increased value of purpose for consumers, brands, and leaders.  

I present here brief recaps of select sessions with content that will be of value to many of our blog readers. 

Session Spotlight: “What We Learned About Ourselves in 2020”

Dimitar Vlahov, Senior Sustainability, Regeneration & Brand Transformation Expert at SB kicked off the event with an overview of key trends reflecting the state of our planet, society, and business environment, including:

  • Increasing existential risks related to biodiversity collapse. This, he said, is “very real and very close.” With one million species currently at risk, and global wildlife populations down 68% since 1970, humans and livestock now comprise 96% of all existing mammals. Only 4% of mammals on earth are in the wild. This is a tragic and very dangerous imbalance, he posited.
  • Growing presence of climate grief and climate anxiety in youth and young adults
  • Erosion of social /societal cohesion.
  • Increased focus on racial justice. Because this is such an important trend, Sustainable Brands will host a Just Brands event devoted exclusively to social and racial justice in May 2021.
  • Widening digital inequality.
  • Rise of intentional (and unintentional) spread of false news. False news stories on Twitter travel six (6x) times faster than true / factual stories, according to a recent MIT study.
  • Declining trust in institutions, specifically national governments, global companies, and the media.
  • Signs of collapsing multilateralism.
  • Rising inequality of stock market holdings in the United States of America. U.S. families in the top 1% of net worth hold nearly 40% of overall equities, while families whose net worth falls in the bottom 50% hold only 1% of overall equities, according to Survey of Consumer Finances data presented by The New York Times.
  • Growing commitments to Stakeholder Capitalism have yet to be supported by appropriate levels of action. Despite the promise made by 180 members of the Business Roundtable (BRT) to redefine the purpose of a corporation as benefiting all stakeholders (employees, customers, suppliers and local communities in addition to shareholders) very few have apparently amended their governing purpose guidelines beyond the long-term focus on the Professor Milton Friedman school of shareholder primacy.
  • Increase in Science Based Targets on climate. Over 1,000 companies worldwide are working on science-based emissions reduction targets through the Science Based Targets initiative (SBTi). Exciting news: methodologies are also being developed for setting science-based targets for water, land use, forests, biodiversity, and oceans as well – described below.

Session Spotlight: “Goal Setting & Innovation: Critical Environmental Thresholds”

Kevin Moss, Global Director of the Center for Sustainable Business at the World Resources Institute (WRI) and Chair of the Science Based Targets Network, moderated this discussion with Lina Constantinovici, Founder and Executive Director of Innovation 4.4 and Roberta Barbieri, PepsiCo VP of Global Water and Environmental Solutions.

The session covered new developments around science-based targets (SBTs) for all aspects of nature: biodiversity, climate, freshwater, land, and oceans.

This, of course, in addition to SBTs for climate, which are gaining popularity. This important work is being performed by the Science Based Targets Network, comprised of 20 nonprofits including World Resources Institute. Science-based targets for nature, geared toward cities and companies, will be released by 2022. Initial guidance for business is already available in this 2020 report.

Developing methodologies for these targets poses a challenge, due to contextual variations of resources based on region, accessibility, and use. Freshwater use in a water-scarce region has different limitations than in a non-water-scarce region.

Nevertheless, these targets will be critical in the management of the global commons that power not only our economy, but our very existence.

The SBT Network is currently partnering with private sector companies to pilot targets to determine their feasibility and effectiveness.

Important news:  PepsiCo has signed on to pilot a freshwater target wherein each water-scarce watershed in its supply chain will have a unique target for water management.

PepsiCo knows that freshwater is material to its business and has been focused on water stewardship for years. Adopting a science-based freshwater target will inform the Company about what is required to alleviate water risks, and how far it is from achieving its own water targets.

As Roberta Barbieri pointed out, if PepsiCo is water insecure, other companies are as well. She hopes that this pilot will influence other companies to participate in such work going forward.

Lina Constantinovici shared the mission of Innovation 4.4, which is to accelerate the commercialization and deployment of water, energy, health, materials science and space technology most critical to the achievement of the Paris Agreement and the United Nations Sustainable Development Goals.

Her session highlighted the critical issues facing oceans today, sharing that oceans are Earth’s most valuable asset, contributing US$70 trillion to global GDP annually and over 50% of the oxygen we breathe.

Yet — the quantity of plastic in oceans is expected to outnumber fish by 2050, and UN Sustainable Development Goal 14 – Life Below Water – is second to last in terms of the funding it receives compared to the other SDGs.

For this reason, Innovation 4.4 developed a multi-pronged strategy to innovate for better oceans. Initiatives include Oceans Funders, which enables a more aligned and informed approach to funding ocean solutions, and Oceans Prize, a contest to find plastic alternatives and remove existing plastic from oceans.

Global collaboration and ambitious thinking will be required to tackle our global challenges, of which oceans and freshwater are only two examples. The forthcoming SBTs for nature will allow organizations to measure and take responsibility for their environmental resource use.

Perhaps in a few years’ time we’ll be so lucky as to hear about 1,000 companies working toward such targets. This SB ’21 Trendwatching event provided cause for stakeholder to be optimistic that the rise of brand purpose will help to move us in that direction.

About Author Kirstie Dabbs
2021 Intern Team Leader
G&A Sustainability Reports Research Intern

Kirstie Dabbs is currently pursuing an MBA in Sustainability, with a focus on Circular Value Chain Management, at Bard College in New York. Her fluency in corporate disclosure stems from the program’s emphasis on the Integrated Bottom Line. As an MBA student she has enjoyed developing sustainability strategies for public, private and nonprofit organizations.

In her role as an Associate Consultant for Red Queen Group in New York City, Kirstie provides organizational analyses and support for nonprofits undergoing strategic or management transitions. Her rich background as a project manager at The Metropolitan Opera has informed this role, and she remains an enthusiastic supporter of the visual and performing arts.

Kirstie is also a member of the Climate Reality Leadership Corps, an organization led by former Vice President Al Gore that promotes awareness of climate change worldwide, and is a contributor to GreenHomeNYC, a resource for green building and career development in the New York metropolitan area.

The United States of America Moves Forward with the Biden-Harris “Climate Crisis Agenda” for Federal Government Actions

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March 2021

by Hank Boerner – Chair & Chief Strategist – G&A Institute

As he assumed the post of the highest elected public officer of the United States, President Joseph Biden characterized his [as the] “Climate Administration” — and immediately (the fabled Day One actions) set out a very ambitious “climate crisis” policy agenda for action by the many arms of the Federal government agencies under his control. (Notably, all cabinet offices with their great reach into all corners of the American Society.)

As a current commentary in the influential Harvard Business Review explains: “Biden put the environment squarely at the heart of U.S. federal policy, and for good reason. The future competitiveness of the U.S. economy is at stake, and climate action is an effective way to boost jobs, prevent future systemic shocks, and secure a prosperous future.”

In the commentary by Maria Mendiluce, CEO of the We Mean Business coalition, she posits at least seven important implications for corporate sector and other business leaders:

  • Climate regulation is coming (with a “net zero emissions” goal envisioned by 2050). Climate-focused regulations are being adopted around the world and we can expect to see some in the near term in the United States of America. The U.K. is an example – 2030 is the end date for sales of gasoline-powered autos.
  • Corporations will be in the vanguard in moving society in transitioning to the net zero ambitions (companies can help to scale up solutions for de-carbonizing society). Examples cited include Amazon, Apple, Ford, Microsoft, Walmart, Uber, and Verizon.
  • There’s risk for companies that delay climate action. Watch out if your enterprise is not “de-carbonizing” and transitioning from “black-to-a-green” energy company.
  • As we are seeing, investors are looking with favor on companies that taking action on climate matters – portfolio managers are moving away from high polluting firms. Asset managers like BlackRock are leading the way in pushing corporate leaders to adopt net zero targets. Capital is “looking” for greener businesses to invest in.
  • Soon, we can expect climate risk disclosures and reporting on GHG emissions to become mandatory. The Commodity Futures Trading Commission (CFTC) has warned that financial regulators must recognize climate change poses risk to the U.S. financial system. The head of that federal agency is now talked about as prospective Chair of the Securities & Exchange Commission in the Biden-Harris Administration.
  • While there has been discussion about carbon pricing schemes, and a bit of action in Europe, we can expect to see that discussion to increase in tempo and a price put on pollution.
  • Public sector investment in clean energy is on the rise (look at the volume of “green bonds” in recent months). In the United States, the new administration pledged to invest US$2 trillion in clean energy and infrastructure and the many Trump-Pence Administration rollbacks of environmental regulations are being put back in place by Biden-Harris actions.

We can expect to see more presidential Executive Orders, more administration, corporate and public sector pledges and commitments, and more Biden-Harris administration policy definitions related to climate action in 2021.

President Biden plans to convene a Leaders Summit for Earth Day and have the U.S. government back at the table at COP 26, the global confab for climate negotiations. “The USA is back” is the theme for 2021.

Concludes Maria Mendiluce: “This is a turning point for the U.S. and the world. It’s not too late for companies to adapt to the new net zero economy and support a green recovery. There is also no time to lose.”

We have selected her essay in HBR for the Top Story category of the G&A Newsletter this week, along with relevant developments in the “Climate Administration” of President Joe Biden and VP Kamala Harris.

The “We Mean Business” coalition has 1,596 companies involved with collective market cap of almost $25 trillion; these firms have made 2,000-plus “bold action climate commitments” to date. There is more information at: https://www.wemeanbusinesscoalition.org/

TOP STORIES

Federal Policymakers & Regulators Embrace or Reject ESG / Sustainability Factors – a Complicated Story of To & Fro

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March 23, 3021

by Hank Boerner – Chair & Chief Strategist – G&A Institute

Federal policymaking and regulation with respect to investor risk and opportunity in the United States of America is a complicated story played out over almost a century. 

The modern era of laws passed/rules adopted to implement got underway in earnest in 1933 and 1934 following the October 1929 “Black Tuesday” stock market crash and subsequent failure of Wall Street firms and banks.

The Securities Act of 1933 and The Exchange Act of 1934 are the solid foundations of most of the investor protection laws and rules that have followed.

For example, the comprehensive package of changes and reforms that comprised the Sarbanes-Oxley Act of 2002 (assembled as “Public Companies Accounting Reform and Investor Protection Act” in the US Senate [and] “Corporate and Auditing Accountability, Responsibility, and Transparency Act” in the House of Representatives, with 11 separate “titles” in what we today call “Sarbanes-Oxley”) was in part constructed on the solid foundation of the 1934 legislation.

An important driver for SOX moving ahead in the Congress were the collapse of Enron and WorldCom and other firms – dramatically impacting many investors who clamored for change.  (Ah, such crisis events – quicken the pulse and move legislators do the their job.)

The passage of the Employee Retirement Income Security Act of 1974 (“ERISA” for shorthand) following collapse of some retirement plans and reports of negative practices at others was intended to protect plans and participants and address fiduciary duties; included was provision for greater transparency for (private industry) retirement and health plans and those who manage them.

Part of ERISA provides fiduciary responsibilities for managers / those who are in control of plan assets. The agency responsible for enforcing the rules:  The U.S. Department of Labor, a cabinet office of the Executive Branch. And subject, of course, to the political winds of the day.

It’s important to note that the critical elements of the above sweep of Federal government policymaking (enacting laws, assigning responsible arms of government, developing rules, procedures, interpretations & guidance for players involved) are protection. 

The independent Securities & Exchange Commission, as example, was established in 1934 under The Exchange Act to enforce both the ’33 and ’34 acts — essentially to protect investors.

Protection – Guidance:  All good and well.  But these important creations of political bodies are subject to the politics of the time, the era, the whims of people elected to high office and the people they in turn appoint to manage regulatory agencies.

And so, we come to today’s sustainable investing and corporate sustainability topics.

We ask:  are the operating rules, guidance, enforcement, agency management philosophies…keeping up with important changes? Like the emergence of investor preference for sustainable products, including in their retirement and health plans?

Many eyes are on the SEC these days with the Biden-Harris Administration putting forth an aggressive “climate crisis” agenda; with the Federal Reserve System adopting climate change-related policies; and a few days with the easing-off-leading-to-reversal policy of the US DOL with regard to guidance on consideration of ESG in investment decision-making by fiduciaries of plans.

The last is in focus for our Top Stories in this issue of the G&A Institute weekly newsletter.

As a brief example of the to and fro of political positioning by regulatory agencies – from Trump-era decision to Biden-era decision (reversal).

The changes moved quickly at Labor (November 2020 to March 2021).  The decisions to be made at the SEC, sought by many investors to address both ESG risk (protection) and opportunity for investors is a much more complicated story.  No doubt in weeks to come there’ll be welcome news there to share with you in the newsletter.

The sturdy foundations of the ’33, ‘34’ ’74, ’02, and 2010 and other laws and rules can be built on to address both corporate and investor ESG needs & wants in 2021.

For now – take a look at the to and fro of current ESG policies at the US Department of Labor ERISA situation.

TOP STORIES

Pre-crisis, Critical Event(s) / In Crisis! / Prevention, Mitigation – Where Will the World Act in the Context of Climate Change?

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March 29  2021

by Hank Boerner – Chair & Chief Strategist – G&A Institute

At certain times, an unknown unknown may strike, rapidly triggering a serious crisis situation.  Think of a tsunami or earthquake.

Many other times the crisis situation occurs and there are at least a dozen, maybe even dozens of precursor events or activities that over time / if neglected by leadership set up the going over the cliff situation.

The G&A Institute team members have collectively helped to manage literally hundreds of critical events or crisis situations over the years for corporate, fiduciary, social sector and other clients.

Alas, we have seen many critical issues and/or events spin into dramatic crisis situations over time — but none with the scale of the dangers posed to humanity and planet by climate change.  Ignoring this is not an option for humankind.

The crisis situations that can be pretty accurately projected or forecast are often years in the buildup.

Leaders may ignore unpleasant situations until things do spin out of control.  There is the powerful human capacity for denial – this can’t be happening / this won’t happen / there are slim chances that “this” will go wrong, and we will lose control of things.

Until things do go terribly wrong.

Think of the September 11th 2001 terrorist attacks – 20 years ago this year.

What could have been to prevent these? Read the many pages of the report on the attacks published by the US government — you will see page-after-page of factors that illustrate the points made here.

Or, the damages of Hurricane Katrina.  Things were going well in New Orleans – until they were not.

There is the unbelievable, tragic opioid epidemic in the USA. Was anyone tuned in to the unbelievable flow of opiods in the State of West Virginia and other locales?  Many many doses per resident – who was consuming them and why?

Right now – there is the still-out-of-control, worldwide Covid pandemic. There will be abundant case histories published on this in the years to come.

Think about the Exxon Valdez oil tanker spill crisis in vulnerable Alaskan waters 30 plus years back — and what could have been addressed in preventative measures. (We did numerous corporate management workshops on this event, walking through two dozen clearly-visible precursor events.  One factor impacted another than another. And another.

Think about what could have been addressed up front to address these situations and other classic crisis situations well ahead of time to prevent or limit the human and physical costs.  The good news?

We have time today to address the unbelievable potential harm to human and widespread physical damages that we will see in the worst cases in global climate changes.

It takes recognition of these serious risks and dangers, the political will to act, widening public support of the leaders’ actions, and considerable financial investment.  So – ask yourself – are we on target with limiting of damages, mitigation for the worse of possible outcomes, and most important, in taking prevention strategies and actions?

Each of us must answer the question and then take action.  The encouraging news is that collective action is now clearly building in volume and momentum – that’s the focus of some of the Top Stories we selected for you in the current newsletter.  There are valuable perspectives shared in these stories.

The world stands at critical point, said UN Deputy Secretary-General Amina Mohammed to European Parliament Vice President Heidi Hautalan, referencing the 2030 Agenda for Sustainable Development.

The United Nations is working to strengthen its partnership with the EU to deliver on the 17 Sustainable Development Goals (SDGs – with 169 targets for action). “The work is more urgent than ever” was the message.  This is the decade for multilateral engagement and action – we are but nine years away from a tipping point on climate disasters.

Many companies in North America, Europe, Asia-Pacific and other regions have publicly declared their support of the SDGs – but now how are they doing on the follow up “action steps” – especially concrete strategies and actions to implement their statements (walking-the-talk on SDGs)?

The Visual Capitalist provides answers with a neat infographic from MSCI; the powerhouse ESG ratings & rankings organization sets out the SDG alignment of 8550 companies worldwide.

Are they “strongly aligned” or “aligned” or “misaligned” or “strongly misaligned”?  Looking at this important research effort by MSCI, we learn that 598 companies are “strongly misaligned” on Responsible Consumption and Production” (Goal 12) – the highest of all goals.

Could we as individual consumers and/or investors and/or employees of these firms help to change things in time?  (Back to the proposition — Think about what could have been addressed up front to address these situations and other classic crisis situations well ahead of time to prevent or limit the human and physical costs.)

Are we willing to make tough decisions about these enterprises – about the climate crisis overall?

And this from the world’s largest asset manager, BlackRock:  The firm will push companies to step up their efforts to protect the environment from deforestation, biodiversity loss and pollution of the oceans and freshwater resources.  T

his from guidelines recently published by the firm, including the readiness to vote against directors if companies have not effectively managed or disclosed risks related to the depletion of natural capital – the globe’s natural resources.

President Joe Biden, in office now for just over two months, has a full plate of crisis, pre-crisis and post-crisis situations to deal with.

Intervention is key, of course, President Biden and VP Kamala Harris have set out the “Climate Crisis Agenda” for our consideration.  One of the big challenges?  Our oceans – and the incoming head of the National Oceanic and Atmospheric Administration (NOAA) will be on point for this part of the agenda.

NPR Radio had interesting perspectives to share on the warming of the oceans and what can be done to prevent further damage.

We bring you the details of all the above in our selections of Top Stories for this week’s newsletter.  Of course, there is action being taken.  Is it enough to prevent global disasters as the climate changes?

Your answers and actions (as well as “ours”) can help to determine the answers!

TOP STORIES for you…

On Corporate Risk Strategy, Sustainable Actions & Outcomes – What’s the Best Ways to Report on ESG to Stakeholders?

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April 2021

by Hank Boerner – Chair & Chief Strategist, G&A Institute

Buzz… Buzzz… Buzzzzz! The current buzz among key stakeholders – investors, corporate boards & management, NGOs, government regulators, stock exchanges, ESG raters & rankers, ESG corporate disclosure standards and frameworks managers – is centered on “Quo Vadis”…where do we go from here!

The good news is that the lively discussions underway appear to be indicating progress in the global drive to achieve more holistic, meaningful, accurate, comparable, understandable corporate ESG disclosure approaches.

One, to help publicly-traded company managements understand and provide transparency for the data sets, metrics and narratives that asset owners and their managers, and (2) to help creators of sustainable investing products in their expanding analysis of companies of all market cap sizes.

Influential players are part of the discussion.

Example: The World Economic Forum (WEF) published a White Paper in January 2020 to set out a framework to bring sustainable reporting frameworks & standards into a common and consistent system of metrics. This, to help investors and companies attain sustainable value creation and accurately disclose on same. WEF suggests a set of 22 Core metrics and a range of Expanded metrics to start with.

At the same time the “Big Five” of the global corporate sustainability disclosure and reporting frameworks and standards organizations are collaborating and recently published a shared vision of the elements necessary for achieving more comprehensive and holistic corporate sustainability reporting.

The five organizations are: CDP; the Climate Disclosure Standards Board (CDSB); Global Reporting Initiative (GRI); International Integrated Reporting Council (IIRC); Sustainability Accounting Standards Board (SASB). Plus TCFD, the Task Force for Climate Related Financial Disclosure, created by the Financial Stability Board (FSB), a G20 nations organization.

Joining the effort: The European Commission; IOSCO (global government securities regulators organization); WEF’s International Business Council; and IFRS.

Each issue of the G&A Sustainability Highlights newsletter we bring you information about the above and much more related to the increasing tempo of the buzzzzz on corporate sustainability disclosure and reporting.

The discussions are taking place worldwide as leadership in public sector, private (business/corporate) sector and social sector address a widening range of ESG issues that will over time determine what kind of world we’ll live in.

See: meeting the challenges of climate change multiple issues, diversity & inclusion, populations deciding on democracy or authoritarianism, having ample food supplies or facing starvation, providing equality of opportunities & outcomes, pandemics to come, rapidly disappearing natural resources, political financing, a range of labor/workforce challenges…and more.

The content silos in our newsletter are designed to help you scan and select the news and perspectives we gather for you each issue.

The G&A Institute’s “Sustainability Headquarters” (SHQ) web platform has many more items selected by our editorial team led by EVP Ken Cynar for you. He’s assisted in these efforts by G&A’s Amy Gallagher, Reilly Sakai, Julia Nehring, Elizabeth Peterson, Lucas Alvarez, Lou Coppola, and Hank Boerner. All of this is team effort! Check the expanded related contents not in the newsletter on SHQ!

We constantly monitor all of the above issues — the global ESG disclosure buzz! — and participate in certain of the conversations as guiding the ESG disclosure and reporting of our corporate clients is at the core of the G&A Institute mission.

TOP STORIES

CEOs & Business Leaders Speak Out on Voter Rights – Corporate Citizenship, USA-style On Display

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April 14 2021

By Hank Boerner – Chair & Chief Strategist – G&A Institute 

Corporate America and “Corporate Citizenship” – Today, that can mean lending the CEO and company voice to address critical societal issues in the United States of America.  Some applaud the move, while others attack the company and its leader for their position on the issues in question.   

In this context, powerful messages were delivered today from the influential leaders of the US corporate community – clearly voicing concern about the American electoral process and the rights of all qualified voters in the midst of mounting challenges to the right-to-vote. 

What the CEOs, joined by other influentials in the American society, had to say to us today:

As Americans we know that in our democracy we should not expect to agree on everything.

However – regardless of our political affiliations, we believe the very foundation of our electoral process rests upon the ability of each of us to cast our ballots for the candidates of our choice.

We should all feel a responsibility to defend the right to vote and oppose any discriminatory legislation or measure that restrict or prevent any eligible voter from having an equal and fair opportunity to cast a ballot.

Who is saying this? A list of bold name signatories in an advertisement that appears today in The New York Times and The Washington Post – these messages (these above and more) splashed across two full pages (a “double truck” in newspaper language) with a dramatic roster of prominent names from Corporate America. And prominent accounting and law firms with bold name corporate clients. And not-for-profits. And individuals. Celebrities.  People and organizations that every day in some way touch our lives. 

This advertisement certainly continues to set the foundation in place for pushback by powerful people and organizations as various state legislatures take up electoral voting measures. And pushes back against the “Big Lie” that the November 2020 elections at federal, state and local levels were widely fraudulent.

The names on the two pages jump out to capture our attention: Apple. American Express. Amazon. Dell Technologies. Microsoft. Deloitte and EY and PwC. Estee Lauder. Wells Fargo. BlackRock. American Airlines and JetBlue and United Airlines. Steelcase. Ford Motor and General Motors. Goldman Sachs. MasterCard. Vanguard. Merck. Starbucks. IBM. Johnson & Johnson. PayPal. T. Rowe Price. And many more.

CEOs including Michael R. Bloomberg (naturally!). Warren Buffett. Bob Diamond, Barclay’s. Jane Fraser, Citi. Brian Doubles, Synchrony. Brian Cornwell, Target. Roger Crandall, Mass Mutual.

Luminaries joined in as individual in support of the effort: David Geffen. George Clooney. Naomi Campbell. Larry David. Shonda Rhimes. Larry Fink. Demi Lovato. Lin-Manuel Miranda. Many more; think about the influence of their influencers in our American society in 2021.

And we see the names of these law firms: Akin Gump. Arnold Porter. Milbank. Morgan Lewis & Bockius. Fried Frank. Cleary Gottlieb. Holland and Knight. Ropes & Gray. (If you are not sure of who these firms and many more law firm signatories are, be assured that in the board room and C-suite and corporate legal offices these are very familiar names).

And the “social sector” institutions/organizations signing on include leaders of the Wharton School, Morehouse College, Spelman College, University of Pennsylvania, Penn State, NYU Stern, United Negro College Fund, Hebrew SeniorLife, and Council for Inclusive Capitalism.

The New York Times covered the story of the advertising message in an article in the Business Section – Companies Join Forces to Oppose Voting Curbs (bylined by Andrew Ross Sorkin and David Gelles). Subhead: A statement that defies the GOPs call to stay out of politics.

The effort was organized by prominent Black business leaders including Ken Chennault, until recently the highly-regarded CEO of American Express, and Ken Frazier, the also-widely-admired CEO of Merck.

Recall that Senate Minority Leader Mitch McConnell corporations said that corporations should “stay out of politics”. The recent State of Georgia legislation addressing voting rights was a trigger for prominent corporate leaders (such as heads of Coca Cola, Delta Airlines, both headquartered in Atlanta) to criticize measures that could deter or inhibit minority voter populations from exercising their rights.  Leader McConnell reacted to this. 

The Times quoted Kenneth Chennault: “It should be clear that there is overwhelming support in Corporate America for the principle of voting rights…these are not political issues…these are the issues that we were taught in civics…”

Also made clear: The CEOs, social influential and thought leaders including celebrities involved in the ad message effort were non partisan and not attacking individual states’ legislative efforts.

Remember The Business Roundtable’s recent re-alignment of the groups mission statement to focus on “purpose”? According to the Times report, the subject of the ad effort was raised on an internal call and CEOs were encouraged to sign on to the statement; many CEOs did.

Where does this go from here? Corporate executives are speaking out separately on the legislative measures being discussed in individual states that appear to or outright are clear about restricting rights of minority populations. That happened in Georgia recently. Coca Cola and Delta Airlines were hit with criticism; those companies were not signatories on the ad today. Home Depot (also HQd in Atlanta) waffled; the company is not represented on the signatory line nor was there public criticism of the legislature’s effort.

Perspective: While corporate citizenship has been an area of focus and public reporting for many years at a number of large cap public companies, the glare of publicity centered on the question of “what are you doing to help advance society on critical issues as a corporate citizen” is more recent.

The spotlight is intensifying on voting rights (as we see today) and also on climate change, diversity & inclusion, human capital management (especially in the Covid crisis), investment in local communities, in supporting public education, in hiring training & promotion of women and minorities, doing business with nations with despot leaders (think of Burma/Myanmar), equality of opportunity for all populations…and many other issues.

And so today’s advertising splash with CEOs especially putting their stake and their company’s stake in the ground on these types of issues is something we can expect to see continue and even expand in the coming weeks.

The division lines in the USA are certainly clear, especially in politics and public sector governance, and we are seeing that corporate leaders are responding to their stakeholders’ expectations…of being “a good corporate citizen”.

And it’s interesting to see the perspectives shared that even the meaning and understanding of the responsibilities of the “corporate citizen”) is defined along some of the lines that divide the nation.

Interesting footnote:  Clearly illustrating the political and philosophical divide, the members of the Republican Party who are organized as the opposition to the GOP today — The Lincoln Project — called on followers to sign on to an email that singles out JetBlue (one of the ad signatories) for contributing to political campaigns of what the Lincoln Project calls “seditionists”.  These are elected officials who “support voter suppression”. Says the project: If enough of us make it clear that we won’t stand inequality, voter supression and sedition, we will make a difference.

The battle lines are clearly drawn in voting rights issues. 

The advertisement today:

April 14 2021 – The New York Times and The Washington Post messages: