Sustainability Drives Success in a Post-Coronavirus World
ESG matters more than ever in choosing good companies.
The coronavirus pandemic has pulled forward environmental, social, and governance (ESG) trends by years in a matter of months.
Societal pressures are driving unprecedented change and the need for real solutions from governments and businesses alike.
In the current environment, it is more important than ever for companies to incorporate sustainability into their long-term strategies.
Crisis causes change. We know this both as human beings and as experienced global investors. The 2008 global financial crisis (GFC) led to a reckoning in how businesses were run, especially in financial services. The GFC ultimately redefined fiduciary responsibilities, shifting more emphasis toward clients and shareholders. Fueled by government bailouts, new regulations, and shareholder activism, the crisis led to more transparency and fundamentally changed the financial world—in most ways for the better.
In the years following the GFC, we have seen seismic shifts in the global economic landscape: In particular, technology has permeated all sectors and industries, creating remarkable efficiencies and capabilities. In some ways, technology has been a significant democratic force, spreading power, knowledge, and sophisticated tools to many. But technology has also been hugely disruptive: Generating significant efficiencies has led to job losses and some industries disappearing altogether. Meanwhile, we have also seen wealth concentration and natural monopolies created with clear winners and losers, which in turn contributes to social and political tensions.
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