Why effective ESG starts and ends with your stakeholders

ESG issues and sustainable investing are hot topics, with businesses, investors, and stakeholders paying close attention to responsible practices, with 89% of investors considering ESG as part of their investment approach.

However, it is widely understood that truly impactful and effective ESG initiatives are created by listening to a business's diverse set of stakeholders and creating a more accessible, stakeholder-focused approach should lead a business's ESG strategy.

Sanlam’s ESG Barometer

South African-based asset management firm Sanlam's ESG Barometer makes a strong case that effective ESG engages all stakeholders in the process of defining and measuring ESG objectives.

The STANLIB case study, featured in the ESG Barometer, demonstrates how Zeyn Ismail, Head of Investment at STANLIB, takes an inclusive approach to ESG rather than an exclusive one. STANLIB uses shareholder meetings as an opportunity to listen and truly understand the issues that might affect their shareholders and their local community.

Louise Gardiner, co-founder and CEO of Vukani Impact Collective, believes that prioritising stakeholder engagement more than anything else is essential when it comes to measuring ESG impact and, by extension, listening to stakeholders when defining ESG objectives.

How to Better Communicate and Build a Relationship with Your Shareholders

Companies can empower stakeholder voices on ESG by offering hybrid and virtual meetings to include a more diverse group of stakeholders, keeping them engaged and informed about their ESG goals.

ESG and stewardship reporting are essential components of transparent communication with stakeholders. If stakeholders do not know where a company stands with its ESG goals, they will not be as ready to offer their own insights. If a company is not set to meet its ESG objectives, this is an opportunity to be open and transparent, building trust with its stakeholders.

Including all stakeholders in a company's AGM is an integral component of empowering businesses to better understand the deeper contextual and personal relevance of their ESG campaigns. Virtual and hybrid AGMs offer the tools to host Q&As, introducing the opportunity to hear from a more diverse group of shareholders.

Breaking down communicative barriers with stakeholders, boosting transparency, and facilitating greater accessibility at shareholder meetings and AGMs will help businesses build powerful, well-informed ESG initiatives. By working together, companies and their stakeholders can create meaningful, sustainable change and build a better future for all.