ESG and growth: a new way of thinking

By Christine Korwin-Szymanowska, Tom Beagent, James Cousins

Report series

Despite a growing and significant body of thought leadership on Environmental, Social and Governance (ESG), it remains an area many executives are still grappling with. This article offers a framework to help think about, and put in place, business initiatives to address ESG while identifying growth opportunities, and bridging the gap to the more technical aspects of ESG. Over the next few weeks, our experts will also explore in more depth how this applies to different sectors in our upcoming industry focused report series. ESG and Insurance, and ESG and technology, media and telecoms and ESG and banking are now available to download or you can pre-register for the upcoming ESG and industry reports.

Companies can no longer ignore ESG

A dramatic acceleration of interest in ESG in the past 12 to 18 months has increased awareness of the impact of companies on the environment and society. Driven by factors such as climate change, social inequality and the impact of COVID-19 - and amplified through social media platforms – ESG has become front of mind for all.

These concerns are reflected in a PwC survey of UK consumers which found that 67% of respondents reported ESG considerations are important for them.[1] People want businesses to make a profit whilst solving social and environmental challenges. Contrary to popular belief, the older segments of the population are even more concerned than millennials; these concerns are not limited to younger generations. People want businesses to deliver benefits to people while operating sustainably and minimising their environmental and social impact. Some investors believe that sustainable businesses are worth more, and employees want to work for companies whose values match their own.[2]

Separating E, S and G: Finding where to participate

At its simplest, ESG provides an umbrella framework to consider a company’s impact and dependencies on the environment and society, as well as the quality of its corporate governance. To make it easier to tackle, executives should first think through the three elements of ESG separately, rather than as a whole, and do so at the next level down – i.e., the five or six sub-elements of each of E, S and G. From there, organisations will be able to decide what actions to take. Below is a framework to break down ESG into more structured and manageable sub-elements.[3]

ESG - Dimensions and Examples

Now more than ever before, companies are answerable not just to shareholders but to a broader, and more vocal, group of stakeholders: customers, employees, suppliers, communities, the press and regulators. These wider stakeholders are increasingly interested in how ESG drives corporate performance. Other topics on the corporate agenda, Brexit for instance, while complex and important, are focused on narrower stakeholder sets.

Having broken ESG down into concrete elements, business leaders should then address the crucial question of their level of ESG ambition, both overall and for each chosen sub-element, against the expectations of those stakeholders who matter most to the long-term viability of their businesses and the ESG dependencies for corporate strategy and financial performance. Can they consider that just keeping up with evolving regulations will be enough? Or should they view this as an opportunity to re-align their market-participation strategy with major long-term customer trends?

A call to action

To avoid ending up with a long list of disjointed initiatives, executives should assess how impactful potential ESG actions are (vs their ambitions, stakeholder expectations, importance to business and risks management), and how easy they are to implement (or how ‘doable’ ESG innovations are). While businesses will want to size the return on investment of potential ESG initiatives, a lot remains to be done on narrowing the gap that exists between the historical way of measuring performance and the new and longer-term concepts. The illustration below provides an example of how a portfolio of selected initiatives might land, for an illustrative company [4]. Indeed, corporate resources are limited, and trade-offs often need to be made, although deprioritised actions can potentially be reconsidered in following years.

Example ESG oppportunity set (non-exhaustive)

Having prioritised ESG initiatives, companies will need to decide how to integrate them into corporate strategies and operating models, and execute the change while de-risking it at the same time. Ultimately, an organisation’s ambitions will determine whether it drives growth through an ESG-aligned corporate strategy, or whether its ESG strategy simply sits on the side of its corporate strategy.


[1] A nationally representative survey of UK consumers, conducted by PwC UK in February 2021.
[2] An increasing body of evidence shows that stronger ESG performance is associated with better shareholder returns, suggesting that improving environmental performance could increase equity attractiveness. See the Blackrock website for work on metrics of company valuations, incl. intangibles.
[3] This framework is aligned to others, such as the MSCI or the WEF Stakeholder Capitalism metrics, but it does not perform the same purpose; the purpose here is to focus on concrete and actionable initiatives that relate to the construct or a corporate.
[4] For an approach to striving to eradicate modern slavery in the supply chain, see the PwC article.

Contact us

Christine Korwin-Szymanowska

Christine Korwin-Szymanowska

Partner, Insurance, Strategy& UK

Tel: +44 (0)7984 567298

Jon Williams

Jon Williams

Partner, Sustainability & Climate Change, PwC United Kingdom

Tel: +44 (0)7595 609666

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