Be wary of SDG hypocrisy by greedy corporations
Emeritus Professor Tan Sri Dato' Dzulkifli Abdul Razak
Opinion - New Straits Times
January 31, 2023
AS the threat of global warming and climate crisis becomes more real and directly felt by many countries around the world, the ante is up. New concepts and ideas are being coined and invented to help increase the level of awareness all round.
Earlier, concepts like Education for Sustainable Development (ESD) were introduced to drive the same in the early 2000s, resulting in the educational sector becoming more participatory in teaching and learning ESD at various levels.
So, too, research and innovation in trying to mitigate the happening to a great extent. That said, activities associated with humans continue to be a challenge, so much so industrialisation is generally regarded as "toxic" to the environment and humanity is going back to the 18th century.
Then there is "responsible" research to ensure that community members involved are responsibly engaged from the beginning to the end. Especially when massive commercialisation is the final target based on transnational human exploitation. Networks have sprouted, some more flaky than others namely in the business sector.
As such, a nexus based on environmental, social and governance factors, or ESG for short, was introduced. Generally, it refers to the three key factors when measuring the sustainability and ethical impact of an investment in a business or company.
ESG factors are regarded as "a subset of non-financial performance indicators which include ethical, sustainable and corporate government issues such as making sure there are systems in place to ensure accountability and managing the corporation's carbon footprint".
For example, the Environmental criteria focuses on waste and pollution, greenhouse gas emissions and climate change among others.
Whereas the Social criteria looks at working conditions, including child labour and slavery, health and safety as well as funding of projects or institutions to serve the poor and underserved.
Governance, on the other hand, examines the policies of corporations including tax strategy, donations and political lobbying and corruption and bribery.
ESG, therefore, is meant to screen investments said to be on the rise significantly in the years to come to further promote sustainable development.
Be that as it may, the recent landmark decision made by the apex court raises the urgent dilemma of how socially responsible corporations are in making ESG-proof investments.
As noted by the judge: "The governance of property development requires constant vigilance and a holistic approach in decision making by the relevant authorities."
In addition: "It brings to the fore the need for a holistic approach in decision making in relation to property development, particularly on hill land and steep slopes as notwithstanding legislation in this regard, sustainability of development has not necessarily been ensured," she said.
Due to greater climate change awareness and descending natural resources, rigorous public supervision towards sustainable practices and products must be given attention to moderate the exponential rate of economically-driven (unsustainable) development.
Often behind the facade of ESG sans ESD, companies can undermine the delicate scales of profitability and sustainability of planetary health! Worryingly, the claimed sustainability aspirations for the future are hanging on a thin thread in implementing the United Nations Sustainable Development Goals come 2030.
As often noted, long-term sustainability rather than short-term profits should be the rule of thumb, where real-life context becomes the key turning point in making SDGs relevant to the local needs and wants for the future!
As mentioned by the prime minister "a holistic notion of prosperity must begin with the realisation that neoliberal economy has failed to tackle inequality and social inclusion".
Otherwise, ESG is a hypocritical instrument that corporations can use to mask their greedy agenda.
* The writer, an NST columnist for more than 20 years, is International Islamic University Malaysia rector