In an age of higher awareness of sustainability issues, but rife with social media misinformation and greenwashing, enterprises are facing challenges in balancing business and ESG demands.

Consumers are becoming more aware of the sustainability and ethical issues associated with the products and organizations that they interact with daily.

The COP26 summit late last year also highlighted the magnitude of the environmental crisis, and people are now looking to businesses and leaders to make meaningful changes.

This has resulted in South-East Asia brands becoming more concerned with communicating policies; they now have a better understanding of what good looks like, and areas such as ESG are front and center because reputation is now at stake.

However, how can organizations measure their ESG performance in real time against competitors, stakeholder demands, and other investments – while meeting business and sustainability objectives?

DigiconAsia sought out some answers and insights from Khali Sakkas, Head of Insight, CARMA Asia.

Why are environmental, social, and governance (ESG) considerations becoming more important for businesses and organizations, particularly in South-East Asia (SEA)?

Khali Sakkas (KS): There are several forces combining to build ESG as the number one priority for organizations across SEA. The growing momentum behind the ESG movement has brought sharp focus on how companies integrate environmental, social and governance strategies into their business and culture.

Drawing on our media data, the volume of coverage around ESG has been overwhelming. In the last six months of 2021, there were over 80,000 media reports mentioning ESG related issues, with an average of 528 articles per day in Singapore, Malaysia and Hong Kong. The peak of this coverage was the UN Climate Change Conference (COP26) in October-November 2021. While there was a slight drop off in media attention from that point, it remains a major focus for PR and communications teams who are tasked with designing and executing the communications strategy as companies make pledges, introduce and implement ESG strategies.

How does media intelligence assist organizations in measuring their ESG efforts?

KS: Media intelligence helps organizations and governments prioritize and strategize. Social listening often also gives us an early warning signal to a possible crisis and serves as the ultimate pulse check and trend detector. We use it to track the “promise-deliver divide” because if companies are not walking the walk – we will hear about it on social media.

I think there will be serious backlash for companies that don’t deliver on their promises, and we will continue to see allegations of greenwashing. Media intelligence helps to keep companies informed of recent case studies and trends in greenwashing policy and perception.

For the most part though, ESG announcements and policies are a key source of positive media exposure for businesses in SEA and tracking this in a comprehensive way means that organizations can improve their key messaging and effectiveness continuously.   

How can organizations use media intelligence to mitigate the negative impact on their reputation?

KS: Misinformation is a huge threat to brands these days and social media has made it easy for bad news to quickly spread far and wide on the internet.

Media monitoring and social listening help companies stay on top of these. Monitoring mentions and conversations on your organization in the public space allows you to act swiftly and respond in the most appropriate manner to mitigate the reputational risks that your brand will be exposed to if such online discussions are left unaddressed.

With the current focus on ESG, what is the biggest challenge for organizations today, especially in SEA?

KS: Obviously, there are significant challenges to company profits and changing the way we operate.  Beyond these challenges, I think public skepticism is one of the major tests for all organizations. Consumers, shareholders and stakeholders are all well-informed and expect meaningful change by organizations in SEA.

The ESG landscape will become more challenging this year because the “quick wins” are long gone, and it is time to audit and deliver on specific promises.

From a PR and media perspective, it will most likely fall into a predictable pattern: Company announces initiatives, skeptical audiences react, stakeholders and experts criticize initiatives for either greenwashing or not going further enough or fast enough. This scenario will require tenacity and commitment to the longer-term goals.

I believe there are two critical moments that organizations need to plan for in their ESG journey. 

  1. The release of your company’s first audit will need to be a very strategic planning exercise. It will be a pivotal moment where C-suites and stakeholders will be reacting to this audit in the media. 
  2. When commitments fall short or have not gone fast enough, having a message to explain that is extremely critical in helping to shape the narrative. The goal here for PR is to provide authentic communication that helps to manage expectation and finds the right balance between aspiration and impact.

What should organizations do to incorporate ESG performance into strategic decision-making more effectively?

KS: ESG is interesting because it involves so many stakeholders and it is in the remit of every single executive and non-executive function. Strategic decision making will involve a lot more people, it will take the employee and the customer into account more than in the past and it will focus on company culture and brand equity far more than profits and returns. 

A recent talk by Kimberly-Clark’s chief scientist, Pete Dulcamara, focused on the concept of “humanity-centric innovation” and I think it is a great way to think about how our views of products and value are changing. He called for us to redefine the word “billionaire” to mean a person helping a billion people – not a person accumulating a billion dollars. 

This type of thinking and a pivot to purpose is how we will start to see ESG coming into decision-making. It’s a mindset shift as well as a strategic and operational change.