As environmental, social and governance (ESG) measures climb higher on both the consumer and investor agenda, companies will begin to lose business if they fail to get on board, new data has found.
Almost a third of mid-market companies have admitted they face a “high” or “very high” risk of losing out on business if they fail to act, according to accountancy and business advisory firm BDO.
However, 36 per cent of surveyed businesses said that their risk was “low”. While a further six per cent decided that there was no risk at all.
Diversity and inclusion have also been climbing the ranks in terms of business priorities.
The figures suggest that ESG considerations becoming more prominent on the agenda for mid-market businesses.
Companies have even begun ranking it higher than their recovery from Covid-19 and post-Brexit challenges, with 38 per cent of business leaders saying that meeting ESG criteria is their highest priority.
While 36 per cent cited attending to Brexit difficulties and 25 per cent pandemic recovery.
“While the pressure to improve ESG performance has to date focused on the large polluters, big financial institutions and publicly listed companies, we are now seeing a trickle-down effect with ESG now firmly on the board agenda at mid-market level,” BDO senior partner and chair of the firm’s ESG executive committee, Matthew White, explained.
Wake up call
White added that the data reveals how many businesses are “waking up to the reality that failing to take ESG seriously could have serious commercial consequences”.
Fewer than one per cent of the respondent said that their business had not yet made any plans for upping its environmental commitments.
“It is encouraging to see so many mid-market firms taking action to reduce their environmental impact, but globally emissions will need to be halved over the next decade so there is still much more to do.”
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