Originally published in Sustainable Brands, I asked 3 experts to help distinguish between two core concepts in business sustainability: ESG and Purpose.
It may seem like an article about semantics. But make no mistake, the value of the article comes from demonstrating that ESG alone is not enough.
To make meaningful progress on society’s challenges and reap the benefits of an engaged workforce, loyal customers, and improved competitiveness, your business needs to declare a Purpose: one that articulates the unique contribution you are making to the world.
Introduction
Consumers, employees, investors and other stakeholders increasingly expect companies to adopt both a corporate Purpose and robust ESG (environmental, social and governance) or sustainability practices.
Aside from these expanding expectations, we need the business sector to play a major role in order to meaningfully address the enormous, complex challenges facing the world.
Without the private sector’s financial investment, networks and influence, we simply won’t .
However, in the effort to redefine the role of business in society, Purpose and ESG are sometimes competing for attention. It’s not always clear which should be considered first, how the two interrelate, or how they are different.
Often, the two are either discussed in isolation or conflated, leading to confusion at best and dismissal at worst.
If we have any hope of achieving the United Nations’ 17 Sustainable Development Goals, the last thing we want is for business leaders to be lost in a sea of meaningless jargon.
I reached out to three industry experts to explain the relationship between corporate Purpose and ESG, and how best to prioritize and embed them within the organization:
Nikhil Bumb — Director at FSG and co-author of The Economist’s “Beyond Trade-Offs” series
Coro Strandberg — advisor to the United Way Social Purpose Institute and President of Strandberg Consulting
Phil Preston — founder of The Business Purpose Project in Australia and author of the book, Connecting Profit with Purpose
