Blackrock backs #sustainableinvesting, Australia's Greenwashing Warning and 3 Levers of Organisational Transformation

This week in ESG

Blackrock Defends #sustainabileinvesting position

BlackRock has defended its position of sustainable investing, telling the state attorneys-general that climate change is a top concern for its clients and a key risk to consider in financial decisions.

The worlds largest money manager has been under concerted attack for its use of environmental, social and governance (ESG) factors in investing.?There were 19 atttorney generals from multiple states who wrote to the CEO of Blackrock, Mr Fink, alleging that the firm was focused on pushing and pursuing a 'climate agenda' ahead of generating returns for state pension plans (AFR, 2022).

Mr Fink responded saying that including #esg and climate risks in their investment strategy that they are able to generate better long term financial returns.

What We Think: The evidence suggest that sustainability drives innovation. Therefore as with any investing strategy, picking the right business assessing all risks including #esg and #climate can generate solid long term financial results for clients.

It is surprising how many?fund managers, institutional investors and portfolio companies are yet to properly start their ESG journey, and have little to zero insights into the risks and performance of their investee companies.

Our recommendation for all companies thinking about starting the ESG journey is to just start. Gather data and insights, undertake a maturity assessment, develop a strategy and communicate with your team, investors and portfolio companies.

Prime Minister Commits to working with resource sector to make Australia a 'trusted supplier of energy'

Earlier this week Mr Albanese said that Australia has the potential to become a renewable energy superpower.

Currently Australia is one of the top exporters of iron ore, lithium, LNG, and metallurgical coal?in the world and the work that is continuing to be done in the resource sector is shaping Australia's success.

In a bid to make Australia a trusted supplier of energy and resource, Mr Albanese reiterated the governments commitment to ensuring an 'orderly' energy transition.

'I want to emphasise that our government will continue to work with your businesses to reduce emissions in a predictable and orderly way, underpinning the energy transition with certainty.?In the same way, Australia will continue to be a trusted and stable supplier of energy and resources to our key trading partners.?As we work with other nations to reduce emissions globally, we will continue to be a reliable provider of energy'. [Source: Prime Minister Anthony Albanese speaking Australian Minerals Council Parliamentary Dinner 05/09/2022]?

Greenwashing Warnings

Australia is one of the latest countries to take a stand against greenwashing, the practice of misleading consumers about a company's environmental practices. But this scenario is changing and evolving rapidly.?

The Australian Competition and Consumer Commission (ACCC) has taken the first step toward cracking down on greenwashing.?

The ACCC made an announcement earlier this year that it will begin using technology to track companies' claims that they are environmentally friendly. The ACCC will be using these apps to determine whether companies are truly living up to their "green" claims.?

This is all part of a larger effort by the ACCC to stop companies from engaging in unethical consumer behavior, called "greenwashing." Greenwashing has become a big problem for consumers, because many people want to purchase products that aren't harmful to the environment. However, there are many companies who will make these claims without actually being able to back them up; these companies are taking advantage of consumers' desire to be green while also harming them financially by selling them products that aren't actually good for the environment.?

In order to combat this problem, the ACCC will begin using apps so they can more easily determine whether or not a company's claim is true or false. This move marks an important step forward in helping consumers make informed decisions when buying products and services from businesses.?

Consumers now have access to many apps that help identify truly environmental friendly actions in Australia and around the world. Some of them are:?

• Good on You – an app which rates clothes and fashion brands according to their ethical and sustainable practices. Its classification system ranges from gas emission, and water consumption to legal and worker safety conditions. The data comes from several globally recognized indices, such as the Fashion Transparency Index and CDP Climate Change.??
• ?Think Dirty – it lists beauty and cosmetic products and their ingredients. It “educates the consumer on the cosmetics industry by allowing them to make an informed decision on what products to purchase”.?
• Fair Food Forager – an app that rates different segments of the food industry, “covering all elements of sustainable practice within the food industry”, such as reducing waste, meat-free or reducing the consumption of meat, sustainable seafood, locally produced and others. Consumers can easily search for more sustainable brands and restaurants.?

With so many tech offers and information easily accessible to consumers, companies looking to avoid being greenwashed should ensure that their marketing materials are accurate and transparent about what they do and do not offer customers.?

LEADERSHIP

5 Levers of Organisational Transformation

It is a known fact that businesses need to continue to innovate in order to stay relevant, keep growing and continue to take steps towards their mission. As the business product innovates, it is rarely mentioned how the internal organisation and team must also grow and transform to meet external factors.

A great example of this was during Covid, where we saw companies experience agility, inclusion, decisiveness, customer focus and empathy in ways they never had done before.

A common question for the team at Apricot is how do we create and maintain the behaviours that are required to continue to transform and grow as a team and company.

Here are 3 Levers that leaders can use:

1. Stay focused on the mission and purpose of the business

When team members are committed to the purpose of the business, they are going to be committed to delivering the strategic goals and outcomes of the business. An alignment of purpose, strategy and culture is shown to produce a 120% return on investment.

2. Obsess over the customer

How can you increase customer satisfaction? How can you bring a better solution to their problems? Obsess over this.

Jeff Bezos is well known for his customer obsession and he said it best: "There are many ways to centre a business. You can be competitor focused, you can be product focused, you can be technology focused, you can be business model focused, and there are more. But in my view, obsessive customer focus is by far the most protective of Day 1 vitality."

3. Focus on people

Focus on creating the right environment for your people. A space where they are safe to be themselves, safe to fail but more importantly safe to make big bold moves that can move the company forward. We love the question, "What would you do if you were 10x bolder?"

Quote of The Week

"It’s worth remembering that it is often the small steps, not the giant leaps, that bring about the most lasting change." - Queen Elizabeth II

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Apricot is a global consultancy that help's the world's most ambitious leaders and change makers define and build a more sustainable and inclusive future.

We implement leadership, organisational change and ESG solutions to create growth that matters. Have a question or interested in one of our services? We'd love to hear from you! Please click?here.