Environmental and Social Governance (ESG) rules, the set of standards for a company’s behaviour used by socially conscious investors to screen potential investments, could be about to have a big impact on the sector, says Rob Prevett, growth director at event tech firm Totem. Because when BlackRock and the World Economic Forum speak, the events industry must listen...
The weight of our large financial and global institutions is
getting heavier, as anyone paying attention over the past few years can attest.
Few, however, will have paid attention to what these corporate behemoths –
namely various NGOs, the World Economic Forum, the UN and BlackRock – are
edging businesses towards.
We won’t get bogged down with the details of the
guidelines for MSCI Fund ESG Quality Scores - it’s positively labyrinthine! But
suffice to say, if BlackRock is implementing Environmental and Social
Governance (ESG) scores across mutual funds, this means that the age-old metrics of
valuing businesses – profit, turnover, etc – are now set to sit alongside and
perhaps be coupled with sustainability and social metrics.
As big business moves, the ripple-effect will sweep you with
it. The onus on SMEs - that make up most of the event industry - is arguably more
urgent than it is for big businesses who already have the legal, HR and
administrative frameworks in place to adapt.
However, here are some pointers that will put you in good
stead:
Measure
Having proof of what you are doing, from a social or
sustainable perspective, is crucial, whatever stage you are at in the process.
Without benchmarking where you’re at now, how can you track your improvements?
Events that require extensive global travel will likely be viewed unfavourably
Go digital
Physical events have a raft of measures to make them far
greener. However, just because your event is physical, that doesn’t mean you
shouldn’t digitise as many of its metrics as possible. It’s important to be
frank, however, and events that require extensive global travel will likely be viewed
unfavourably.
Consider virtual
Virtual certainly isn’t right for all events, but extending
your event’s lifecycle to an ‘always-on’ model is surely the future. Creating
virtual meetings and seminars on the back of your physical event gives provable
data to show you’re creating green alternatives to high CO2 events. Virtual and
physical events must grow together, sustainably, and platforms which provide
measurable feedback under one ecosystem allow for unprecedented control.
Be inclusive
The Social element of ESG is noteworthy. Look at the profile
of your business and seek to produce a collaborative, diverse workforce, while
considering projects that reach out to your community and beyond. Virtual is a
powerful tool here, allowing you to open up to the world and cover topics that
suit intimate, carefully-curated audiences.
Adhering to ESG rules might seem burdensome, but with it
comes unparalleled opportunities to grow your business in an exciting,
futureproof direction that’s truly conducive and complementary to traditional
financial measurement. The more digital integration you allow, the better your
data, targeting and monetisation potential will be.
Thinking in terms of ESG will bring more benefits to your
events and your business. Don’t get left behind.
