Prof. K S Chandrasekar
As Jammu and Kashmir is now undergoing through a series of low temperatures which were not witnessed till now and the difficulty in the sustainability, the question of ESG becomes important. ESG stands for “Environmental, Social and Governance.” ESG can be described as a set of practices (policies, procedures, metrics, etc.) that organisations implement to limit negative impact or enhance positive impact on the environment, society, and governance bodies.In recent years, investors have become more aware of the importance of ESG criteria in their investment decisions. As a result, many businesses have begun to integrate ESG into their operations and business strategies.ESG can be considered a subset of sustainability, which is defined by the UN World Commission on Environment and Development as ‘meeting the needs of present generations without compromising the ability of future generations to meet their own needs’.
ESG framework helps identify, organise, analyse, prioritise and accordingly guide decisions on various business risks. These risks, if left unaddressed can prove costly to the functioning and sustenance of businesses. India’s priorities for the 2023 New Delhi G20 Summit included “Accelerated, Inclusive & Resilient Growth,” “Accelerating progress on SDGs,” “Technological Transformation and Digital Public Infrastructure,” and “Women led Development.” If we consider Environmental factors and SDGs, SDG 6 (Clean Water and Sanitation): ESG factors related to water management, pollution control, and conservation align with efforts to ensure access to clean water and sanitation for all. SDG 7 (Affordable and Clean Energy): ESG criteria focused on renewable energy adoption, energy efficiency, and carbon emissions reduction contribute to the goal of ensuring access to affordable, reliable, sustainable, and modern energy for all. SDG 13 (Climate Action): ESG factors related to climate risk assessment, greenhouse gas emissions reduction, and adaptation measures support efforts to combat climate change and its impacts.
In the case of social Factors and SDGs, SDG 1 (No Poverty) and SDG 10 (Reduced Inequalities): ESG factors related to fair wages, labor rights, and social inclusion contribute to poverty reduction and reducing inequalities within and among countries. SDG 3 (Good Health and Well-being) and SDG 4 (Quality Education): ESG considerations related to workplace health and safety, employee wellness, and access to education support goals for promoting health and education for all. SDG 5 (Gender Equality): ESG factors promoting diversity, gender parity, and inclusive workplace practices align with efforts to achieve gender equality and empower all women and girls.
In the case of governance factors and SDGs, SDG 16 (Peace, Justice, and Strong Institutions): ESG criteria emphasizing transparency, ethical conduct, and anti-corruption measures contribute to building effective, accountable, and inclusive institutions at all levels. SDG 17 (Partnerships for the Goals): Strong governance practices, including stakeholder engagement, responsible business conduct, and sustainable investment, facilitate partnerships for achieving the SDGs and mobilizing resources for sustainable development. Post-COVID, all countries have deviated from 2030 SDG targets. India’s priorities are those of reducing poverty and providing basic necessities to its citizens. Many sustainable development initiatives are technology and resource intensive, which is why something like SDG 13 is a collective responsibility.India wants to be ambitious, inclusive, decisive, and action-oriented in taking the green development and SDGs agenda forward,” asserted Amitabh Kant, G20 Sherpa during the meeting in Kumarakom, Kerala.Jeffrey Sachs responded by stating, “The world should aim to have at least an incremental US$ 1 trillion every year to finance sustainable development for the world’s poorest and most vulnerable countries.” Nina Fenton, EU stated, “There is so much more that needs to be done. The Covid-19 pandemic has caused significant declines in investments on the development front and the world should strive to respond with greater urgency.”
To ensure an effective green transformation, following emerged as critical check points for the G20 to work on:Building coherence around economic, social, and environmental goals through recognize the commercial value of long-term investments in human and natural capital.Ensuring continuity in the G20’s efforts to make energy accessible for the most vulnerable communities, pushing forward agricultural reforms, and building towards sustainable cities and lifestyles, in addition to promoting just transitions for green development.Recognize the opportunities for course correction while at the same time pushing for concerted efforts for adaptation to ensure resilience and equity.Accelerating climate and development finance flows to the developing world through increased collaboration among diverse stakeholders.Achievement of the SDGs would require substantial scaling up of investments in all forms of capital, making the banks fit for purpose, incentivising private sector participation, and pushing for an increased focus on debt and concessional finance for vulnerable countries.To ensure convergence of the global policy space and international finance, the prospects of economic growth and job creation from additional long-term investments must be highlighted to build a compelling political and economic case for sustainable and green transformations.
KPMG keeping in mind this G20 meet that, Climate conformity will get more stringent which will result in the rise of Sustainable Brands. This is an opportunity to begin switching gears on their business strategy in favour of the long term and integrating sustainability and social impact into their brand promise. Sustainable impact will fundamentally define how consumers and brands see themselves and impact brand valuations.Digital Infrastructure and AI for Real-time ESG- Green and Digital Skills for scalable transformation. Built environment also accounts for 40% of global carbon emissions, over 30% of global final energy use and consumes nearly half of the world’s natural resources. We need to urgently cut emissions from the built environment and change how we design and construct buildings to successfully respond to the climate crisis, nature loss and growing inequality. The unprecedented concrete jungles being built can cause more harm and this is where planned cities, townships which can provide more open spaces, vegetation can be of help.
Climate adaptation and resilience are crucial for businesses, as the risks posed by climate change are increasing, including disruptions in supply chains and infrastructure failures, workforce displacement, increased cost of inputs, and more. Businesses must act to safeguard the resilience of workforces, key supply chains, and the communities and natural ecosystems upon which they depend, building collective resilience and avoiding mal-adaptation. Climate is going to be a major concern over the years and soon will become unbearable. If we do not heed to the experts on the same, soon there will be issues an problems which cannot be controlled.
(The author is Vice Chancellor, Cluster University of Jammu)
