Twenty-first International Conference on Knowledge, Culture, and Change in Organizations

Abstract

Environmental, Social, and Corporate Governance (ESG) encompasses three dimensions that should guide organizations’ plans from now on in order for them to make their contributions towards the achievement of the Agenda 2030 and SDGs. Financial leaders have an important role to play helping companies to understand the need to create value through social, environment, and governance initiatives that will create intangible assets to the company, attracting responsible investors and at the same time engaging stock holders in protecting and improving life in our planet. This paper explores evidence that organizations with a good ESG rating besides attracting more investment, have been showing lower cost of capital, more steady earnings, and a lower market risk. At the same time such organizations witness the improvement of their brand image with more transparency, strict anti-corruption practices in a more diverse environment with high governance is achieved. The social aspect is also key and such companies show exemplary labour standards allowing to better and safety performance where good relations with partners, customers, and other stakeholders is always fostered. Last but not least, companies with good ESG ratings are sensible to the need to take care of their environment, the need to have a pro-active posture towards climate change reviewing all their internal processes to align their business plans to sustainable strategies caring about what they produce, what they buy, and what they sell.