Why couldn't companies sail through a financial crisis?
Elysia Teh, EFFAS-CESGA, Founder for ESG Integration in Organizations, HRDC TTT Trainer
ESG Certification, ESG Supplier Audit, Educational support programs for all ESG related needs, including courses, training, consultancy, coaching, business management, and investment advisory
Why couldn't companies sail through financial storms? Who are the experts to tell you? Who concerns you most?
The answer is with the ESG experts ......why? Because they are the investors, they are the capital markets.??Think about this, how many economic crises the capital markets had gone through since the 1st century? Although it's not countless, it's a long list.?
Let's talk about the popular ones:?
·???????Tulip Mania (1637). ...?
·???????Credit Crisis of 1772. ...?
·???????Stock Crash of 1929. ...?
·???????1973 OPEC Oil Crisis. ...?
·???????Asian Crisis of 1997–1998. ...?
·???????The 2007-2008 Global Financial Crisis. ...?
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·???????COVID19 Pandemic....now
Most people, especially the non-financials, think ESG is about environmental-related projects, green energy projects, plastic-related projects, CSR projects, etc. They have misunderstood the meaning of ESG.??ESG is not about projects, it's about the "investment decision process".?
The truth is, after every economic crisis, the leaders who were concerned about economic development, would call for initiatives to prevent the next economic crisis. The capital markets must learn from the painful experience and do something to improve the capital markets. After the Asian Crisis of 1997-1998, Kofi Annon (who was the Secretary of the United Nations at that time), asked major financial institutions to collaborate with the United Nations and the International Finance Corporation in identifying ways to integrate?environmental, social, and governance?concerns?into capital markets.
As a result, there came the "ESG Integration -?integrating?ESG concerns/factors?into valuation models and investment decisions from the risk/return perspective (Mercer 2018).??
Do you see that???ESG is not about projects, it's about integrating ESG concerns/factors into valuation models and investment decisions........it's an investment decision process.??Nonetheless, all the ESG concerns and factors remain in the evaluation and thinking process of investment, they are not being implemented throughout the entire operations of any organization.???
The empirical evidence done by renounced credit rating companies, research, meta-studies, etc. over the past 25 years had proven that the companies that were picked through this investment decision process could sail through the 2007-2008 global financial storm better and stronger.?
What does this tell you? It means they were spot on with the ESG concerns and factors. Now, Elysia Teh is working with Wawasan Open University to take these ESG concerns and factors to the next step, i.e. the implementation step - implement it throughout the entire operations of the organization. Do sign up for the "ESG 360 degree - The Full Clarity" workshop offered by Wawasan Open University?on 10 - 11 May 2023.?Here is the registration link: https://bit.ly/3F3QaaG This is a top executive course focusing on ESG 360-degree understanding.
The goal of this course is to give you a clear full picture of ESG, to begin with, then we will proceed to the implementation stage to build your organization strong and healthy that can sustain long-term growth and even sails through financial storms after installing ESG integration.