According to a recent Board Primer issue by NACD (National Association of Corporate Directors), environmental, social, and governance (ESG) performance has emerged as a board-level issue. While the topic of socially responsible capital markets has been in the air for years – the 2004 “Who Cares Wins” initiative pushed ESG concerns as a component of routine investment choices – NACD’s 2019-20 public company governance survey showed that boards were waking up to the importance of ESG. This led NACD to develop Strategic Oversight of ESG: A Board Primer. “Although ESG is as broad as it is amorphous in scope,” NACD says, “it is not an insurmountable topic for the board agenda.” The primer is a good start. It breaks the topic down into manageable chunks, provides guidance on key terms, and adds some context with a timeline tracing the evolution of ESG from SRI (Socially Responsible Investing) to SVC (Sustainable Value Creation). Check out the Board Primer at nacdonline.org.
Published December 10, 2020.