Corporate directors must be more proactive in ensuring that sustainability is at the core of business operations and to avoid “greenwashing,” an official of the Institute of Corporate Directors (ICD) said.
“In order to survive and thrive over the long term, crises like the pandemic and extreme weather events have taught us that we need to establish resilience at the heart of our strategy and policies. Greenwashing is not acceptable, as it does not address the root of the problems,” ICD Trustee Pedro H. Maniego Jr. said during the forum titled “Pilipinas: Aspire, Rise, Sustain” corporate governance series.
The said forum was organized by ICD, Institute for Climate and Sustainable Cities and Climate Reality Project Philippines.
“ESG [environmental, social, and corporate governance] is an important part of the total valuation of a company, and greenwashing must be unthinkable as the reputational damages would be great. Long-term stakeholder value is more important in the long run than short-term profit,” said Ephyro Amatong, commissioner at the Securities and Exchange Commission (SEC).
The SEC has issued sustainability reporting guidelines for publicly-listed companies in 2019 to help them monitor and report the significant impacts of their sustainability initiatives.
This year, the agency is making sustainability reporting mandatory to align the country’s compliance standards with neighboring countries such as Thailand, Indonesia, Malaysia and Singapore.
Amatong said 92 percent of the companies have filed their sustainability reports, despite the limitations brought by the Covid-19 pandemic.
Citing data from multinational investment company BlackRock, Shai Ganu, governing council member of the Singapore Institute of Directors and managing director of Willis Towers Watson said investments in sustainable assets amounted to $288 billion in 2020, a 96-percent increase from the previous year.
“The ESG landscape is rapidly evolving. The emerging priority now for companies is to safeguard the interest of all stakeholders. It’s not just about the Sustainable Development Goals, it’s also about how these ESG measures are embedded in how management teams run their businesses,” he said.