What are the risks and opportunities business ought to address in the post-COVID19 world? Your Public Value is starting a series of interviews on best practices and business strategies that address new risks and opportunities. The experts we interviewed in this series are all co-creators of the European public value principles we will publish in September 2020. With this series of video interviews and podcasts, we wanted to share some of the collective intelligence that led to finalising the public value principles. Meet our first guest Pyarali Jamal.
Pyarali Jamal has many years of experience in finance, impact investing, renewable energy and real estate. He has worked with and been a board member for various organisations, and has worked with both start ups and large companies, including with EY in various senior roles.
In his interview with Your Public Value, Pyarali Jamal reflects on how COVID-19 has been a clear demonstration of the interconnectedness in the world. “Conceptually, this is not new“, Jamal said, “as we already were aware of the impact of globalisation and just-in-time-manufacturing. However, COVID-19 has brought more emphasis to addressing risks and being better prepared“.
Pyarali Jamal mentioned the rise of the Extinction Rebellion Movement and the growing trend of millenials who now want to work for companies that are contributing positively to society. This, he mentioned, can be found across the board in different industries. Such a trend, however, is not the sole privilege of the young generation. Despite some hesitations, 175 Parties managed to sign the Paris Agreement in December 2015. The European Green Deal, which aims to making Europe climate neutral by 2050, also boosted the economy through green technology, and sustainable industry.
COVID-19 has brought more emphasis to addressing risks and being better prepared
As a result, companies focus more on their impact on the Environment, Society, and Governance (ESG), as well as on their Public Value creation.
Companies have strategic reasons to prioritise their environmental and societal impact:
- Increasingly, hiring and retaining staff depends on how the company addresses ESG issues;
- More consumers want to buy products from companies which are generally aligned with their values; and
- More care in manufacturing the products is needed to avoid the risk of Covid-19 disruption.
Although the majority of consumers keep buying according to price, attention to ESG matters consistently increases among the public. Suffices to mention that demand for renewable energy is growing, leading the costs to drop substantially in the last 20 years. The cost of electric vehicles also has decreased. Finally, the vegan movement has grown; this has a clear environmental component as cows produce the most CO2 outside of industry production.
What remains to be done to shape a different economy
The COVID-19 crisis has revealed the fragility of low-cost businesses that used to count on massive consumption. We see today how much airlines and fast fashion companies have been exposed. We know that some of these businesses will not survive the crisis and that others will be exposed because of their harmful impacts to the environment.
Generally speaking, companies do incorporate ethical decision-making processes and do develop strategies to impact more positively on society and the environment. This is a positive consequence of banks and other rating agencies also becoming ESG specialists, and of investors revising their criteria to include more ESG performance indicators.
But measurement is key and is not yet unified. Without a shared agreement on how to measure public value, business and the economy will never change structurally.
The Digital Revolution
Digital technologies have many implications for ESG. They improve productivity and help support sustainability. They also play a positive role on society (telemedicine is a perfect example).
We should, however, remain mindful that human thinking and relationship-building still hold great importance.
Keeping in mind the points mentionned above, Pyarali Jamal makes the following recommendations to companies interested in adjusting their strategy to the post-COVID-19 world:
- Companies must revisit their mission statements based on their lessons learned. A good example is Danone’s mission statement that demonstrates the company’s social commitment beyond a sole profit objective: “Bringing health through food to as many people as possible.”
- To efficiently contribute to public value, companies should systematically include both financial and non-financial targets, notably, “outcomes“.
Tell us what you expect from business in this post-COVID19 world. What in your views should be the best strategy to address the new risks and opportunities? Feel free to leave comments below or on our social media channels. You can also contact us directly via our website. We look forward to publishing your thoughts on the post-COVID-19 economy.
Your Public Value Team truthfully,