Overview: Developing Environmental, Social, and Governance Strategies for Growth
Environmental, social, and governance (ESG) factors are increasingly important in all aspects of today’s business. In this context, developing a meaningful ESG proposition is critical in the value-creation process. Thinking about and acting on environmental, social, and governance issues in a proactive manner has gained importance following the 2019 “Statement on the Purpose of a Corporation” from The Business Roundtable. The statement declared that companies should serve not only their shareholders but also deliver value to their customers, invest in employees, deal fairly with suppliers, and support the communities in which they operate. This program will give you a working knowledge of the fundamentals of managing environmental, social, and governance issues, which can serve as the foundation for developing a sound corporate ESG strategy. The academic content involves a combination of lectures and practical implementation assignments designed to enhance the learning experience.
Sessions 1–2: Understanding Climate Change (Sergio Rebelo)
This session aims to empower participants to talk knowledgeably about climate change. We discuss key concepts of the science of climate change, including the energy budget, the carbon cycle, the Planck feedback, the greenhouse law, and the ocean’s role in moderating the temperature rise. We also study the economics of climate change, including the role of carbon taxes and the drivers of the damage function that underlie widely used estimates of the economic effects of the temperature rise. In addition, we discuss Wright’s law, an essential concept for understanding which green technologies will scale and be widely adopted.
Sessions 3–4: Behavioral Insights for Designing Impactful ESG Strategies (Alex Chernev)
Behavioral science has become an important tool for companies and organizations seeking to uncover effective and cost-efficient ways to attract, serve, and retain customers in an increasingly competitive marketplace. In addition to creating customer value, behavioral science can play an important role in designing impactful environmental, social, and governance strategies that enable companies to achieve their long-term goals in a way that creates value for society. In this session, we will examine how insights from behavioral science can help organizations promote social change and nudge their customers and employees to embrace sustainability in their daily lives.
Sessions 5–6: Sustainability and Growth (Sergio Rebelo)
In this session, we discuss strategies that make ESG policies compatible with growth. These strategies include measuring impacts and risks, identifying opportunities, avoiding greenwashing and ineffective solutions, designing a road map for sustainable growth, communicating in a way that promotes trust and transparency, and studying market opportunities for new products and services.
Sessions 7–8: From Profits to Purpose (Alex Chernev)
The focus of the ultimate corporate goal has evolved. Traditionally defined as maximizing the profit of shareholders, corporate goals have broadened over time to encompass all activities—including charitable donations and other acts of social goodwill—that directly and indirectly can create value for shareholders. More recently, the definition of corporate goals has been extended even further. It has moved away from viewing shareholder value as the ultimate goal of corporate activities and includes other stakeholders—customers, employees, business partners, and society—as beneficiaries of the company’s actions. In this session, we will discuss how a company should set its goals and priorities and, specifically, how it should balance profits and purpose.