University Report: Global Issues for Management and ESG

This report delves into the critical importance of Environmental, Social, and Governance (ESG) criteria in the contemporary business landscape. It elucidates how ESG principles, encompassing environmental, social, and governance factors, are increasingly adopted by socially-conscious investors and shareholders to assess an organization's impact and guide investment decisions. The report emphasizes ESG's value creation potential, its influence on strategic and operational decisions, and its alignment with long-term corporate objectives. It also references the Business Roundtable's shift in corporate governance principles, highlighting the significance of inclusive long-term growth. Furthermore, it discusses key areas where ESG creates value, including top-line growth, cost reduction, and investment optimization, while also underscoring the role of ESG in fostering innovation, job creation, and sustainable business practices. The report also mentions how the inclusion of the ESG criteria the business is able to play a significant role in creating more job opportunities, providing goods and services to the people and foresting innovation.

Running Head: Global Issues for Management
Global Issues for Management
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Author’s Note

1GLOBAL ISSUES FOR MANAGMENT
Why is ESG such an important topic in today’s business world?
The approach of ESG which is Environmental, Social and Governance criteria are
used by the socially-conscious investors and the shareholders tends to create investments and
assess an organization’s impact on the world (Kuzmina and Lindemane 2017). This affects
the company’s ways of gathering and retaining funds from funding from investments funds
that is socially responsible in investment strategy. ESG is important in today’s business world
because it is more compelling and understanding as in it creates value and is less
comprehensive. However according to the American Economic Model the American where
struggling and often their hard work were not rewarded and hence it did not cater rapid pace
of change in the economy (Atan et al, 2016). Therefore the concept of Business Roundtable
came into force and was introduced with an aim on focusing on the principles and role of a
corporation. This initiative had had analyzed the issues of cooperate governance which
included the purpose of the corporation.
The program of ESG facilitates the program and creates the shareholder value which
comprise of large response. In cases of strategic and operational decisions the executives and
individuals indicates that they commonly take the issues of ESG into consideration makes the
operational and strategic decisions (Stewart 2015). Some of the responses say that in cases of
executives and organisation they consider the issues in respect to their company’s competitor
and supply chain management. Therefore one third of the responses indicate that there needs
to be a direct impact on the board of directors, association, perspective and employees(Koller,
Nuttall and Henisz 2019). The organizations take these issues into consideration and create a
positive impact on the board by implementing the criteria’s.
The elements of ESG which are the environmental issues like climate or scarcity of
resources forms the element which covers the social issues like the company’s labor
practices, product safety, talent management and data security. The topic of ESG is important
in today’s business world because the investors are increasingly aligned through the desire to
understand the long term objective of the company which assist in catering to standardized
information and creating plans and receive credibility. Hence according to the research
conducted by McKinsey had examined that the importance of ESG in the business word and
stated five vital areas which are the top-line growth, cost reduction, regulatory and legal
intervention, product upliftment and investment and asset optimization (Koller, Nuttall and

2GLOBAL ISSUES FOR MANAGMENT
Henisz 2019). With the assistance of ESG there is lower energy consumption in workplace
and the level of water intake is reduced. The employee is facilitated to achieve greater
freedom through deregulation and is able to earn subsidies and cater the facility of
government support.
The business plays a vital role in the economy and also allows the success factors
through creativity and hard work allows leading the life through dignity. With the inclusion
of the ESG criteria the business is able to play a significant role in creating more job
opportunities, providing goods and services to the people and foresting innovation. On the
other hand the business is able to sell goods, manufacture vehicles and equipments, grow and
produce foods and support the national defense.

3GLOBAL ISSUES FOR MANAGMENT
Reference
Atan, R. U. H. A. Y. A., Razali, F. A., Said, J. A. M. A. L. I. A. H., & Zainun, S. A. U. N. A.
H. 2016. Environmental, social and governance (ESG) disclosure and its effect on firm’s
performance: a comparative study. International Journal of Economics and
Management, 10(S2), 355-375.
Koller, T., Nuttall, R. and Henisz, W., 2019. Five ways that ESG creates value. The
McKinsey Quarterly.
Kuzmina, J. and Lindemane, M., 2017. ESG INVESTING: NEW CHALLENGES AND
NEW OPPORTUNITIES. Journal of Business Management, (14).
Stewart, L.S., 2015. Growing demand for ESG information and standards: Understanding
corporate opportunities as well as risks. Journal of Applied Corporate Finance, 27(2), pp.58-
63.